Hosni Mubarak has stepped down as president of Egypt, after weeks of protest in Cairo and other cities
The news was greeted with a huge outburst of joy and celebration by thousands in Cairo's Tahrir Square - the heart of the demonstrations.
Mr Mubarak ruled for 30 years, suppressing dissent and protest, and jailing opponents.
US President Barack Obama said that Egypt must now move to civilian and democratic rule.
This was not the end but the beginning and there were difficult days ahead, he added, but he was confident the people could find the answers.
"The people of Egypt have spoken, their voices have been heard," he said. "Egypt will never be the same again."
"They have made it clear that nothing less than genuine democracy will carry the day."
'God help everybody'
Announcing Mr Mubarak's resignation, Vice-President Omar Suleiman said the president had handed power to the army.
Mr Suleiman said on state TV that the high command of the armed forces had taken over.
"In the name of God the merciful, the compassionate, citizens, during these very difficult circumstances Egypt is going through, President Hosni Mubarak has decided to step down from the office of president of the republic and has charged the high council of the armed forces to administer the affairs of the country," he said.
"May God help everybody."
Later an army officer read out a statement paying tribute to Mr Mubarak for "what he has given" to Egypt but acknowledging popular power.
"There is no legitimacy other than that of the people," the statement said.
The military high command is headed by Defence Minister Mohamed Hussein Tantawi.
US diplomatic cables published by Wikileaks described Mr Tantawi as "aged and change-resistant", but committed to avoiding another war with Israel.
Mr Mubarak has already left Cairo and is in the Red Sea resort of Sharm el-Sheikh where he has a residence, officials say.
In Cairo, thousands of people gathered outside the presidential palace, in Tahrir Square and at state TV. They came out in anger following an address by Mr Mubarak on Thursday. He had been expected to announce his resignation but stopped short of stepping down, instead transferring most powers to Mr Suleiman.A Protester said 'I'll tell my children we made this revolution possible'
"The people have brought down the regime," they chanted in reaction to the news of his eventual resignation less than 24 hours later.
Opposition leader Mohamed ElBaradei said: "This is the greatest day of my life."
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