The EU and Turkey have struck a deal over an EU demand that Turkey recognise Cyprus before membership talks begin.
Turkey's prime minister held intensive talks with EU leaders
The solution they found after two days of tough and at times heated talks was for Turkey to tacitly acknowledge the Cyprus government for the first time.
The deal clears the way for Turkey - large, poor and overwhelmingly Muslim - to start entry talks in October 2005.
But Turkish Prime Minister Recep Tayyip Erdogan insisted signing the protocol was not a formal recognition of Cyprus.
"We did not obtain all that we wanted 100%", he told
a news conference, "but we can say that it was a success."
EU leaders confirmed that Turkey had completed the last of the essential changes in its laws needed to meet the EU's democratic conditions for opening talks.
The astonishing reforms of the past few years, which swept away much of the repressive state apparatus of the past, will be entrenched by both the negotiation process and eventual membership, says the BBC's Jonny Dymond in Istanbul.
Dutch Prime Minister Jan Peter Balkenende, whose country holds the EU presidency, said Ankara had "accepted the hand we offered them".
He said Turkey had worked hard to meet the criteria set out by the EU and that future negotiation would help to resolve many disputes.
Jose Manuel Barroso, head of the European Commission, said: "Today is also a new beginning for Europe and for Turkey... This is not the end of the process. This
is the beginning."
TURKEY'S DRAFT EU ENTRY TERMS
Turkey must sign a customs accord extending to all EU members, including Cyprus
The accord must be signed by the start of entry talks, proposed for October 2005
Membership talks will be open-ended
There is no guarantee of full membership if conditions are not met
If negotiations do fail, Europe will not turn its back on Turkey
Turkey must continue with political and economic reforms
Some safeguards may remain over migration of workers from Turkey
UK Prime Minister Tony Blair said the deal showed there was no fundamental clash of civilisations between Christians and Muslims.
"On the contrary, if [Turkey] fulfils the same principles of human rights, then Muslim and Christian can work together."
The US welcomed the breakthrough. Secretary of State Colin Powell said: "A Turkey that is firmly anchored in Europe and sharing European values will be a positive force for prosperity and democracy."
However, French President Jacques Chirac stressed that Turkey's membership of the EU was still not guaranteed, and promised the issue would eventually be put to a referendum in France.
Austrian Chancellor Wolfgang Schuessel, who has argued against letting Turkey into the EU, said his country would also hold a referendum.
Under the agreement, Turkey must issue a written statement promising to sign an accord extending its customs union to the 10 new EU members, including Cyprus.
This must be done before the proposed start date for talks of 3 October next year, EU diplomats said.
It will mean granting effective recognition to the Greek Cypriot government, but gives Turkey more time to sell the idea to its people.
The internationally recognised southern part of Cyprus is an EU member, but Turkey, which occupies northern Cyprus, had previously insisted it would not bow to demands to recognise the country, calling the issue a "red line".
The EU has said it could take up to 15 years before Turkey is able to join, and entry cannot be guaranteed.
The EU has also announced that it will start accession talks with Croatia in April 2005.
However, talks will begin only if the country co-operates fully with the UN war crimes tribunal for the former Yugoslavia.
Romania and Bulgaria were invited to sign entry treaties in April, ahead of their planned entry in January 2007.