By Christine Kearney and Edith Honan

NEW YORK (Reuters) - Bruce Springsteen, the Rolling Stones and Alicia Keys were among the musical stars headlining an all-star benefit concert for victims of Superstorm Sandy on Wednesday, in what producers promised was "the greatest line-up of legends ever assembled on a stage."

Organizers said the "12-12-12" concert at New York's Madison Square Garden was being distributed to nearly 2 billion people worldwide through television feeds, radio and online streaming.

"How do I begin again? My city's in ruins?" Springsteen sang. He was joined by fellow New Jersey native Jon Bon Jovi for "Born to Run," ushering in a night of musical duets.

Next up, Roger Waters performed alongside Eddie Vedder, and Paul McCartney was due to jam later in the evening with Dave Grohl.

"This has got to be the largest collection of old English musicians ever assembled in Madison Square Garden," Mick Jagger told the crowd. The Stones performed "You Got Me Rocking" and "Jumpin' Jack Flash."

To help with the fundraising, celebrities such as Leonardo DiCaprio, Kristen Stewart, Jake Gyllenhaal, Chelsea Clinton and Billy Crystal took part in a telethon during the concert, which was expected to last four to five hours.

Comedian Adam Sandler took the stage for a Sandy-themed spoof on Leonard Cohen's "Hallelujah," rhyming the title with "Sandy, Screw Ya!"

Backstage, actress Susan Sarandon recounted losing power in her New York home but said that was a small hardship compared with the real victims who lost their homes.

Steven Van Zandt, guitarist of the E Street Band, scolded "the oil companies" and "Wall Street guys" for not doing more to help.

"Even with the music business not what it used to be ... we are proud to be here," he said.

Before the concert, producer John Sykes said $32 million had already been raised from ticket sales and sponsorships. Organizers are hoping to raise tens of millions more.

It was being broadcast live on television, radio, movie theaters, on Facebook and iHeartRadio, and streamed on digital billboards in New York's Times Square, London and Paris.

EXPANDING FUNDRAISING'S REACH

More than 130 people were killed when Sandy pummeled the East Coast of the United States in October. Thousands more were left homeless as the storm tore through areas of New York, New Jersey and Connecticut, causing billions of dollars in damage.

Throughout the show, celebrities shared memories of growing up in New York City or the Jersey Shore, and offered shout-outs to first responders.

"Watching my hometown get pummeled was devastating to watch," said actor-comedian Crystal, who grew up on Long Beach, Long Island. "It's a helpless feeling of what's in store for us maybe in the future."

Sykes was also involved with "The Concert for New York City" after the September 11, 2001, attacks, which raised more than $30 million for charity.

He said technological advances over the past decade had exponentially changed the reach of fundraising.

"We have both traditional and new media behind us in a way that we've never had before, and that is really going to be the 'x-factor' on how much money we can raise for the victims," he said.

Donations raised from the concert produced by Clear Channel Entertainment and the Weinstein Co, will go to the Robin Hood Relief Fund, which will provide money and materials to groups helping people hardest hit by the storm.

(Additional reporting by Piya Sinha-Roy; Editing by Jill Serjeant, Patricia Reaney and Peter Cooney)