The move increases speculation it will ditch the broadsheet format altogether.
The Independent News & Media-owned paper, previously an evening broadsheet, introduced the weekday morning tabloid today, following the trial of a Saturday morning version.
Media agencies broadly welcomed the decision, which they believe will turn around the title's ailing circulation – down 8.3% year on year in February to 94,540 copies, according to the Audit Bureau of Circulations.
"It has proved positive for other titles that have gone compact," said Tony Axon, media director at Northern Irish agency Navigator Blue.
"There's no doubt, in this market, it will freshen what The Belfast Telegraph offers and will, in my view, sell more copies."
The move comes soon after the relaunch of independently owned morning title Irish News as a compact and two weeks before Local Press launches the tabloid Daily View – which has been likened to an Irish Daily Mail.
The already crowded Northern Ireland market will now have five titles competing for a market the size of Liverpool.
Simon Mann, advertising sales director at The Belfast Telegraph, said the changes for both titles were under consideration three years ago, but the plans had been brought forward in order to retain first-mover advantage.
"We're conscious of the new players entering the field and we would be fools to ignore that," Mann said.
"But, nonetheless, while we know that the newspaper industry is littered with failed new comers, we're pleased to be in a position of strength with new products aimed at consolidating our dominant position."
The Belfast Telegraph is now tipped to follow its INM sister titles The Independent and The Irish Independent and switch fully to compact across all editions.
Mann said the broadsheet format would be retained for its evening edition "for the foreseeable future".
"We're allowing our readers to choose and if we see a rapid conversion from evening to morning and broadsheet to compact, that may well affect the timing of when The Belfast Telegraph goes compact – but at the moment there are no plans," Mann said.
He added that it wasn't just about format, but making the paper more available throughout the day should also increase circulation.
However, Navigator Blue's Axon said he was disappointed that the paper hadn't taken the "bolder" option and ditched the broadsheet altogether, which he felt was only a matter of time.
Stephen Lamb, media director at Northern Irish agency Fire IMC, said he supported the move, but was worried about reader confusion since the supplements and much of the news coverage would be the same.
"There's no real distinction, apart from the size, between the morning and evening edition," Lamb said.