The central bank has printed an initial run of a billion of the new notes, which are known in Britain as "tenners", after last year's launch of a five pound note made from a polymer film that the BoE said is more durable and harder to forge.
Tuesday marks the 200th anniversary of Austen's death.
The writer was buried in Winchester Cathedral in 1817 and completed many of her best-known works such as "Pride and Prejudice" and "Emma" in the nearby village of Chawton.
"Ten pounds would have meant a lot to Jane Austen, about the same as 1,000 pounds ($1,300) would mean to us today," BoE Governor Mark Carney said at the launch of the new note in Winchester.
Austen received a 10 pound publisher's advance for her first novel and the new banknote bears a quotation "I declare after all there is no enjoyment like reading!" from her later work, "Pride and Prejudice".
The quotation came from a character who in fact had no interest in books and was merely trying to impress a potential suitor. It drew a mix of amusement and criticism in the media when it appeared on an initial design of the note in 2013.
Carney defended the choice on Tuesday.
"It captures much of her spirit, at least in my mind," he said. "It draws out some of the essence of some of her social satire and her insight into people's character. So it works on multiple levels."
EXTINCTION LOOMS FOR DARWIN
With tactile features to make it easier for blind people to identify, the BoE says each new 10 pound note should last for around five years, compared to around two years for the paper note it is replacing.
Existing 10 pound notes, which feature the scientist Charles Darwin, will cease to be legal tender during the first half of next year.
Rolling out the new plastic notes has not been without its problems. The five pound note released last year drew criticism from vegetarians and some religious groups for containing trace amounts of animal fats - something which will also be the case for the new 10 pound note.
The BoE is working to find an alternative production method in time for when it launches a new 20 pound note in 2020.
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