The 4ft-long reptile was captured by an expert from animal rescue organisation Wildlife SOS as workers rushed to complete preparations for Sunday's opening ceremony.
It is the second snake to be discovered near Games' facilities after one was found in a South African athlete's room yesterday.
And in another embarrassment for organisers, an Indian boxer fell through his bed in the athletes village.
But Delhi's chief minister today said put a gloss on progress and insisted she was confident they would complete the job.
Members of the English team who had been forced to check themselves into a hotel because preparations were so far behind schedule, moved into the games village.
'The facilities are fine, and right now they are enjoying their lunch,' said a spokeswoman.
India has faced harsh criticism for the state of the athletes' village - including complaints about filthy conditions - infrastructure problems and even a snake found in the room of a South African competitor over the weekend.
The games village was supposed to be ready last week, but many teams have delayed moving in because cleaning and repair work have not been finished.
Delhi Chief Minister Sheila Dikshit, who took charge of the work last week, has been seen travelling around the village in a golf cart in recent days to personally inspect the work.
'We inherited a very difficult situation, but it's improving almost by the hour,' she said. 'We are racing against time, no doubt about it, but we will perform.'
Some of the buildings had leaks in them, there was still water in some basements and some elevators were not yet working, she said.
Team officials and athletes said conditions in the village had improved dramatically.
'A lot of work has taken place over the last few days. I am relatively satisfied,' said Mike Summers, head of the Falkland Islands delegation.
His 15-member team will arrive in the city and move in to the village tomorrow, he said.
Juliet Acon, a Ugandan official, said her delegation had been forced to live in hotels for a few days until their rooms were ready on Saturday.
'So far, so good,' she said.
Alistair Whittingham, an archer from Scotland, said conditions were better than he had expected.
'I have stayed in much, much worse accommodation during tournaments elsewhere in the world,' he said.
The games bring together nearly 7,000 athletes and officials from 71 countries and territories.
They were meant to help cement India's reputation as a growing regional power. Instead, its image has been battered by negative publicity about its frantic last-minute efforts to get ready for an event it knew it was hosting seven years ago.
The collapse of a pedestrian bridge leading to the main stadium and the recent shooting of two tourists outside one of New Delhi's top attractions added to organisers' woes.
Montek Singh Ahluwalia, one of India's key economic policymakers, brushed off concerns that the bad publicity could scare off potential investors in India.
'If you are talking about investors, people who are planning to invest significant sums of money in India, (they will do so) based on overall assessment of the economy and the economic policy and so on,' he said.
'I don't think this will become an opportunity for people ... to reverse their opinion of how the Indian economy is performing.'
Nevertheless, the bad publicity has continued, with Australian cyclist Travis Meyer and table tennis player Stephanie Sang announcing yesterday they would pull out of the competition - following a string of other athletes who have decided to stay away, either because of health and security concerns or injuries.
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