Fukuda, known for his conciliatory views on wartime history, marked the anniversary of World War II defeat with a moment of silence in a nationally broadcast annual memorial service.
"The nation inflicted significant damages and pain on many countries, especially on people in Asian countries," Fukuda said at the ceremony attended by Emperor Akihito, whose father Hirohito surrendered exactly 63 years earlier.
"Here I express, on behalf of the nation, deep remorse and humble condolences for all of the people who fell victim," Fukuda said.
Fukuda stayed clear of the Yasukuni shrine, which honours 2.5 million Japanese war dead including 14 top war criminals from World War II. Instead, Fukuda offered flowers at a nearby secular cemetery to war dead.
But Fukuda's two predecessors both went to the Yasukuni shrine: Junichiro Koizumi and Shinzo Abe.
Koizumi's 2001-2006 premiership was wracked by tension with China and South Korea, which accused him of condoning militarism by annually visiting the shrine. Abe stayed away from Yasukuni after taking office as he worked to repair relations with the neighbouring countries.
Passions about the war still run high in East Asia, with many Chinese and Koreans resentful over Japanese atrocities on their soil. Koreans celebrate "Liberation Day" on August 15.
Fukuda has placed a priority on mending ties with China and South Korea, although he did not stop three of his cabinet ministers from visiting the Yasukuni shrine.
"I prayed for the souls of those who offered their lives for the country to rest in peace," Farm Minister Seiichi Ota told reporters after visiting the sprawling Shinto shrine in central Tokyo.
Justice Minister Okiharu Yasuoka and Seiko Noda, the minister in charge of food safety and consumer issues, also prayed at the Yasukuni shrine, along with dozens of lawmakers.
Emperor Hirohito, who was revered as divine and had never spoken to the public before, went on the radio on August 15, 1945 to announce Japan had to "bear the unbearable" and surrender as its cities lay in ruins, two of them obliterated by US nuclear bombs.
Many Japanese veterans and right-wing activists congregate at the Yasukuni shrine on the anniversary of surrender, which coincidentally falls during Japan's traditional holiday of mourning for ancestors.
"It's nonsense that neither Prime Minister Fukuda or the emperor are paying homage," said an 83-year-old man who came to the Yasukuni shrine and said he lost his brother and two cousins in the war.
Mamoru Aoki, 37, said he came to the shrine on a steamy summer day after watching the controversial documentary film "Yasukuni" by Chinese filmmaker Li Ying.
Conservative politicians had criticised the film, which discussed the shrine issue, and nationalist activists had tried to block it from being shown before it opened in May.
"I have my doubts about a shrine honouring the military," Aoki said. "I wonder if those paying homage here really understand the meaning of war."