The Queen has officially opened the third session of the Welsh assembly, heralding new law-making powers.
The Queen told AMs they had to meet Wales' needs more closely
Arriving with the Duke of Edinburgh, Prince Charles and Duchess of Cornwall, she was greeted at the Senedd by Presiding Officer Dafydd Elis-Thomas.
It is her fifth visit to the assembly where extended powers mean laws can be made in Wales, though Parliament will have to agree the area they cover.
She told AMs: "The Government of Wales Act opens a new era for devolution."
The Queen said: "It is now for you to ensure that policies and legislation meet the needs and aspirations of the people of Wales more closely than ever before.
"I shall follow your progress with great interest and hope that you will build on the achievements of the last eight years in the service of the people of Wales."
It was up to the newly-elected AMs, she added, to ensure policy and legislation met the aspirations of the people of Wales.
The Queen chatted with spectators gathered outside the Senedd
First Minister Rhodri Morgan said: "This is an exciting time for Wales. There may even be moments of turbulence to cope with from time to time.
"I will be doing my level best in piloting the aircraft that is Wales, knowing the best aircraft in the world all have wings made in Wales, to get us safely to the destination we all want to see of a Wales that is thriving, healthy, sustainable, skilled and equipped for the new century."
The meeting of the Queen and Mr Morgan marks the new constitutional relationship in which the first minister is now officially appointed by the monarch.
In another change to assembly procedure, the monarch will meet Mr Morgan - who leads a minority Labour administration in the Senedd after last month's election - for discussions similar to her weekly talks with the prime minister.
Prince Charles and the Duchess of Cornwall begin an annual visit to Wales
The assembly's extended powers allow it to make its own laws and has provided for an eventual move to full law-making powers, but only after a referendum.
The assembly will in future, propose, debate, scrutinise and then pass any new specific Welsh laws - which are known as assembly measures - where it has been given the competence to do so by Parliament.
These laws will not need to be approved by Parliament, although it will agree the "area" in which the assembly can make those laws.
A committee of MPs has told AMs that they should seek to pass new laws only a handful of times a year due to the parliamentary timetable.
Labour took control in the Senedd after three weeks of uncertainty following the 3 May election.
Labour, with 26 of the 60 seats, is the biggest party, but three rivals - Plaid Cymru, Conservatives and Liberal Democrats - may form a so-called rainbow coalition to force Mr Morgan out of power.
Two Plaid AMs, Leanne Wood and Bethan Jenkins, had boycotted the royal opening of the assembly and visited a homelessness project in Swansea instead.
"As a Welsh person, I do not see how the monarchy is relevant to my everyday life, and to my generation," said Ms Jenkins.
Following the assembly opening on Tuesday morning, the royal party headed to Cardiff city centre for a tour of the National Museum of Wales.
Prince Charles than continued his annual tour of Wales with a visit to St Fagans National History Museum on the outskirts of the city.
He then went Dyffryn House and Gardens in the Vale of Glamorgan where he saw work being carried out on the house with the help of one of his charities, the Prince's Initiative for Mature Enterprise.
The Prince of Wales' tour will continue until Friday.
Earlier during the royal visit, a police motorcyclist on the Queen's cavalcade was taken to hospital following a collision with a van.
The motorcyclist suffered chest and leg injuries in the collision on Newport Road at about 1445 BST.
Police said he was taken to the city's University Hospital of Wales but his injuries are not thought to be serious.
South Wales Police added: "The Queen was aware of the incident and has made inquiries into the officer's well-being."
Week In Week Out on BBC 1 Wales will broadcast a live debate at 2235 BST on Tuesday featuring Welsh party leaders.