Called Parla, it is used to generate an artificial star about 90 kilometres up in the atmosphere.
There, it interacts with the 10-kilometre-thick layer of sodium atoms left around our planet by meteoroid impacts.
The laser is 'tuned' to make the sodium glow, producing a bright point of light that acts as an artificial star, which ESO's engineers use as a reference to monitor atmospheric turbulence in the telescope's line of sight.
The giant mirrors in the telescope, which can change shape, can be moved as a result of the readings, effectively focusing the telescope's image.
Researchers say that the new laser is more flexible and reliable than the previous one, which is being retired after six years of service.
'When we started developing these lasers, everyone said our goal was nearly impossible - even many of the other experts,' said Domenico Bonaccini Calia of the European Southern Observatory (ESO), which runs the telescope.
The new laser delivers up to 7 Watts of output and is very stable, the team says.
During the commissioning and for demonstration purposes, the team used the system to monitor the dwarf planet Haumea and its moons and the peculiar radio galaxy Centaurus A.