The LottoNL-Jumbo rider triumphed in a sprint ahead of Australia's Caleb Ewan, with Briton Chris Opie third.
That came after several riders fell heavily in a dramatic crash in the final metres in Scarborough.
Britain's Adam Blythe also finished in the top 10, placing eighth on the 173km run from Bridlington, the first of three stages.
Groenewegen also took narrow victory ahead of Ewan in the opening stage of the 2016 event, eventually won by Thomas Voeckler, who is defending his title this year.
"The last climb was hard but the team brought me back into position so I could sprint for the win. It's a beautiful race with a lot of people on the road, that gives you a lot of motivation," he told ITV.
"Today was one chance and tomorrow is another but we'll see."
Saturday's second stage will start on the bridge in Tadcaster that has been rebuilt after being damaged by floods, and is expected to end in a bunch sprint in Harrogate.
Sunday's finale is a gruelling 194.5km ride from Bradford to Sheffield which takes in eight King of the Mountain climbs, including the Cote de Silsden and the cobbles of Haworth's main street, with four ascents saved for a final 22km circuit.
The women's race, featuring Britain's former world champion Lizzie Deignan, takes place over the same 122.5km route earlier in the day.
The Tour de Yorkshire, now in its third year, began as part of the legacy of the county hosting the 2014 Grand Depart for the Tour de France.
Overall classification after stage one:
1. Dylan Groenewegen (Ned/LottoNl-Jumbo) 4hrs 09mins 28secs
2. Caleb Ewan (Aus/Orica-Scott) +4secs
3. Chris Opie (GB/Bike Channel Canyon) +6secs
4. Angel Madrazo (Spa/Delko) +8secs
5. Nacer Bouhanni (Fra/Cofidis) +10secs
6.. Steele von Hoff (Aus/One Pro) Same time
7. Kristian Sbaragli (Ita/Dimension Data) Same time
8. Andre Looij (Ned/Roompot) Same time
9. Adam Blythe (GB/Aqua Blue Sport) Same time
10. Baptiste Planckaer (Bel/Katusha) Same time
Dutchman Dylan Groenewegen claimed the opening stage victory in this year's Tour de Yorkshire.