The pact provides for the transformation of the KLA into a 5,000-member Kosovo Protection Corps, under the command of the former rebel army's leader, General Agim Ceku.

The corps will be restricted to no more than 200 weapons for guard duties.

The KLA was to have been disbanded at midnight on Sunday, but discussions became deadlocked over the structure and role of the new civilian body.

KLA leaders wanted the force to be the nucleus for a new national army of an independent Kosovo and were demanding the right for more members to be allowed to bear arms.

But Nato insisted the corps should be a lightly-armed civil defence body restricted to humanitarian work and disaster relief.

There were also differences over the leadership, name and insignia of the corps.

Limited weapons

The BBC's Jon Leyne: "The agreement has delighted NATO and UN leaders"

The signing followed a day of intensive negotiations led by Nato Supreme Commander General Wesley Clark, who flew in after the talks became deadlocked.

The Kosovo Protection Corps will operate under the supervision of the commander of K-For.

"KLA personnel will cease wearing uniforms and KLA insignia from midnight on 21xSept," a K-For statement said.

"A limited number of weapons will be available for personal protection and the number of weapons available to KPC personnel responsible for guarding and protection duties has been agreed at 200.''

The pact was signed by the KLA's political leader Hashim Thaci, Gen Ceku, UN special representative Bernard Kouchner and K-For leader General Michael Jackson.

During the deadlock, Gen Jackson had warned that the KLA's refusal to accept the civilian corps plan could threaten Kosovo's future.

Virtual antiques

Under a phased 90-day disarmament process signed in June, it was agreed that the majority of KLA troops would return to civilian life, that uniforms would be removed and weapons handed in.

Gen Jackson said the disarmament of the KLA was complete, with more than 10,000 weapons turned in to peacekeepers.

However, it is unclear whether this constitutes the total number held by the rebels. Many of the weapons which reporters have seen at collection centres are in poor condition or virtual antiques.