Police blocked roads, preventing pro-democracy protesters from getting near to the harbour-front venue where Mr Xi swore in the new chief executive, not far from where the last colonial governor Chris Patten tearfully handed back Hong Kong - again in the pouring rain - in 1997.
Lam was selected by a pro-China committee, as were her predecessors, and is already being cast by critics as a China stooge in a city where many are angry at Beijing's tightening grip on the freedoms of its almost eight million people.
In his address during a swearing-in ceremony for Carlie Lam, the semi-autonomous Chinese region's chief executive, Xi pledged Beijing's support for the "one country, two systems" blueprint under which Hong Kong returned to Chinese rule in 1997.
In the Hong Kong Legislative Council election last September, lawmakers who advocated, among other things, independence from China, were elected but later lost their qualifications as lawmakers when China intervened.
The Mainland Affairs Council (陸委會) also expressed a similar concern, urging the Chinese authorities to realize their promise to allow Hong Kong to rule itself with a high level of autonomy.
"It is not just the Chinese government humiliating the people of Hong Kong but it is that Xi Jinping is humiliating the United Kingdom government".
Veteran Democracy Party founder Martin Lee told Hong Kong not to give up its fight for democracy: "This is going to be a long, drawn out battle which will not be won easily", Lee said.
In the morning of July 1, after Lam and her cabinet members took their oaths, Xi took the podium at the Hong Kong Convention and Exhibition Centre to deliver a 30-minute speech.
In his speech, Xi took stern aim at growing calls in Hong Kong for greater political freedom and independence.
Storms to begin, end your Thursday
Strong to severe storms are forecast to redevelop to our west and spread into our area this evening/overnight. Not too surprising, given the high levels of instability and moderate wind shear that will be moving in.
"We are calling on them to. pay attention to the voices of Hong Kong people when formulating their policies, not just to focus on the "one country" part", Au said.
Hong Kong has become restless in recent years, with frequent calls for the protection of democratic freedoms and, in some cases, independence, concepts to which Beijing is firmly opposed.
Pro-democracy campaigners have accused police of abusing their power and assaulting a number of their activists at a protest to mark the 20th anniversary of Hong Kong's return to Chinese sovereignty.
The battle for full democracy, vividly illustrated by 79 days of "Occupy" street protests in 2014, has been a defining issue for the city of 7.3 million.
"I think that will create more opportunities for Hong Kong in the future", said Wang Tao, the head of Asian economic research at UBS Investment Bank. Pro-democracy Hong Kongers like Mr Ng would like the city's people to be able to nominate their own candidate.
Among those arrested was Joshua Wong, the leader of the so-called umbrella protest movement.
China has been cracking down on dissidents in Hong Kong to preserve the stability it desires.
"Hong Kong has developed from a small unknown fishing village into a large global metropolis, forged by the hard work of generations of Hong Kongers", he said. "We support the police's law enforcement actions".
Lam prevailed over a much more popular rival in a selection process decried by many as "fake democracy", with only 777 votes from a 1,200-seat panel of mostly pro-Beijing elites. The news that Nobel prize victor and Chinese dissident Liu Xiaobo is terminally ill and has only recently been granted medical parole has been another source of discontent.