The President along with several government officials, tribal leaders and others attended a prayer meeting in Kandahar and then buried Ahmed Wali Karzai in a nearby village.
President Karzai broke down at his brothers funeral, said reports.
"The president is upset, he is still in grief, about the death of his brother. Wali was a very close brother of the president," said Waheed Omer, Karzai's spokesman.
The Taliban claimed responsibility for killing Ahmed Wali Karzai.
Ahmed Wali was shot dead at his residence by his bodyguard in Southern Afghanistan. He was the head of Kandhar provincial council and had been criticised for having alleged ties with the country's money making opium trade and private security firms.