He arrived with his wife and two daughters on the island of Bali before visiting an ancient Buddhist temple in Java on Wednesday.
Mr Obama is a popular figure in Indonesia where his holiday has received saturation press coverage.
The former US president spent four years in Indonesia as a child.
He moved to the country aged six when his mother married an Indonesian man, following the breakdown of her marriage to his Kenyan father.
Barack Obama's 2010 Indonesia charm offensive
In 2010 he returned to the country as president with his wife, Michelle.
On his latest trip daughters Malia and Sasha accompanied the former first couple.
The distinguished visitors are being accompanied by a big security complement.
Mr Obama is due to meet President Joko Widodo on Friday in his palace south of Jakarta. The family is due to visit the capital on Saturday.
