President Bachelet will focus on trade and science links
President Michelle Bachelet of Chile has met Cuban president, Raul Castro during the first visit to Cuba by a Chilean leader in almost four decades.
At a meeting in Havana, the two presidents signed bilateral accords to improve trade ties and co-operation in science and technology.
The last Chilean leader to visit the communist island was Salvador Allende 37 years ago.
He was a close friend and political ally of former leader Fidel Castro.
Cuba renamed one of Havana's main streets after him following his death during the 1973 coup headed by General Pinochet.
There was no word on whether President Bachelet would meet Fidel Castro, who is recuperating from major surgery at an undisclosed location.
Cuba under Raul Castro has placed an emphasis on reintegrating the island into Latin America, says the BBC's Michael Voss in Havana.
His first overseas visit after he took over from his brother was to Brazil for a summit of regional leaders.
Since then several heads of state have visited - most recently Argentina's President Cristina Kirchner.
President Bachelet, who is being accompanied by a delegation of some 100 lawmakers, aides, business leaders and artists, praised Cuba's achievements in bio-technology and health care.
Ahead of her visit, she had expressed hope that it would help "deepen regional integration (and) political dialogue."
However, Cuban dissidents have said they are disappointed by the decision of President Bachelet, who was once a political prisoner in her own country, not to meet them.
"Bachelet's visit is frustrating, because we expect solidarity from her given the dictatorship her own country has been through," dissident Vladimiro Rocas quoted as saying by the AFP news agency.