Palestinians took control of the Rafah border crossing between Gaza and Egypt for the first time. The crossing is a vital gateway to the outside world for Gaza┐s residents and the strip's economy.
Hundreds of Palestinians had camped outside the terminal for days waiting for the momentous event.
There was huge excitement as people surged towards the terminal to have their passports checked.
Palestinian police struggled to stop the crowd massing around the passport desks.
More than 1,500 people crossed the border on the first day, European Union monitors said.
Taxis and buses bursting with luggage ferried people to and from the terminal.
Many people spoke of their relief at no longer having to run the gauntlet of Israeli security checks.
The terminal will initially open for four hours a day and be supervised by the EU's monitoring mission.
Israel will also continue to monitor the crossing, using television screens from a base a few kilometres away.