The Flight into Egypt, by Titian. Photograph: Getty Images

Catherine the Great bought Titian's The Flight Into Egypt in 1768. Since then the large painting, described by the 16th-century art historian Giorgio Vasari as Titian's first masterpiece, has not been seen outside Russia – until Tuesday.

Loaned to the National Gallery in London by the Hermitage Museum in St Petersburg, the 505-year-old artwork is looking better than it has for decades, after undergoing intensive cleaning and restoration.

The Hermitage began restoring it in 1999, and the whole process took two people more than 12 years. "It was so dark, under layers of varnish and retouches which completely altered it," said Irina Artemieva, curator of Venetian paintings at the Hermitage. "There was no green or blue, only grey and brown and black."

Two years ago, Artemieva sent an image of the work to the National Gallery director Sir Nicholas Penny, another specialist in the Venetian paintings of the period. "He was so surprised by the results of the restoration, we immediately had the idea to present it here in the National Gallery."

The painting is displayed alongside works that inspired it, by artists including Giovanni Bellini, Giorgione and Albrecht Dürer. Titian trained under the first two, and the third was working in Venice at the time The Flight Into Egypt was painted. The curator Antonio Mazzotta described the other works as the ingredients that went into Titian's painting.

"The National Gallery has an ideal context for this painting," Artemieva said. "You have so many pictures [here] which can explain how this masterpiece was born – and in other British institutions too.

"In the British Museum there are drawings by Dürer and his circle and also in some private collections we have many painting from the same period – the same crucial decade of the 16th century."

The Flight into Egypt was painted in 1507, when Titian was still a teenager, working for Giorgione. Commissioned by Andrea Loredan for his palace on Venice's Grand Canal, it depicts the holy family riding through a vibrant rural landscape alive with animals, plants and children. Vasari marvelled that the animals in the picture were "truly natural and almost alive", an impression not diminished by time.

Penny said: "It's a very ambitious picture, enormously important for our understanding of his work. There are very few large paintings of this kind produced by Italian artists at that date."

He said the depiction of landscapes and animals prefigured those in Titian's later masterpieces such as Diana and Actaeon and Diana and Callisto, which the National recently acquired for £95m. "It's fundamental in any posssible meaning of that word."

Later this year the painting will be displayed at the Accademia art gallery in Venice, and after that, said Penny, "it will never travel again in our lifetime", adding: "We're very honoured that having scanned the museums of the world to find the most suitable place for the debut of this picture our colleague Irena should have selected the National Gallery."

The Titian is the latest in a series of loans between British and Russian cultural institutions, marking a thaw in relations after a crisis four years ago when the British Council was ordered to close its offices near Moscow. However, Artemieva stressed that the loan was nothing to do with diplomatic policy but the result of good relations between the Hermitage and the National Gallery.