Terry Stiastny reports from Berlin on the momentous decision

The monument will be a field of almost 3,000 concrete, tombstone-like pillars situated near the Brandenburg Gate in the centre of Berlin and almost directly above the site of Hitler's bunker during World War II.

It brings to an end ten years of argument and indecision over how best to commemorate the 6 million Jews killed by the Nazis.

The Bundestag Speaker, Wolfgang Thierse, said building the memorial allow Germany to end a terrible century with dignity.

"We're not building this memorial for the Jews or for other victims. We're building it for us," he said.

"With this memorial there can be no more denial or indifference."

The parliament decided to include an underground multimedia documentation centre on the site following criticism that the abstract monument would not explain enough of the history of the Holocaust to future visitors.

Bundestag MPs has a free vote on the issue which had divided the country's political parties.

Correspondents say the decision marks an important symbolic moment for Germany as the country's politicians prepare to move their capital back to Berlin.

'City of mourning'

Former Chancellor Helmut Kohl first championed the idea of a central monument in the heart of the German capital.

But the mayor of Berlin, Eberhard Diepgen, had spoken out against a large memorial saying it was too "monumental" and would turn Berlin into a "city of mourning".

The Reichstag overlooks the site for the proposed memorial

And the fear had also been expressed that the pillar design would be an invitation for neo-Nazi vandalism.

The memorial will spread out over four football pitches and resemble a giant graveyard.

The inclusion of a documentation centre is in keeping with Chancellor Gerhard Schröder's wish for more "interactive" elements.

The winning design, by US architect Peter Eisenman, defeated a proposal by German theologian and politician Richard Schröder for a single stone memorial inscribed with the words: "Thou Shalt Not Kill" in languages including Hebrew.