The summit between Lebanese President Michel Suleiman and the Syrian President Bashar al-Assad has been heralded by some observers as ushering in a new era for Syria and Lebanon.
By Bethany Bell
BBC News, Beirut
The presence of President Suleiman in Damascus was symbolic.
Plans announced at the summit show a gradual thaw in relations
It is the first time a Lebanese president has visited Syria in more than three years following a period of tense relations.
Syria dominated Lebanese affairs for almost three decades until 2005, when, under massive pressure, it was forced to withdraw its troops in the wake of the assassination of Lebanon's former Prime Minister, Rafik Hariri.
Many Lebanese blame Syria for the killing - a charge Damascus strongly rejects.
The international tribunal into Mr Hariri's death is still a major potential stumbling block.
But politicians and analysts in both Lebanon and Syria - including Mr Hariri's son, Saad - have described the visit as historic.
Saad Hariri said it was a "historic step toward rectifying relations". But he warned that Damascus must not interfere in Lebanon in the future.
As expected, the summit was welcomed by Syria's ally, the Lebanese Shia group, Hezbollah. Its leader, Sheikh Hassan Nasrallah, said the visit marked a qualitative change in the relationship.
"If we deal with this in a positive way we can resolve all the issues that haven't been solved between the two countries," he said.
The plans announced at the summit are a sign of a gradual thaw in relations.
The two countries said they would establish diplomatic ties and open embassies for the first time since they gained independence in the 1940s - a significant step given that Syria has long viewed the two countries as one.
The Hezbollah leader, Sheikh Hassan Nasrallah, welcomed the summit
Beirut and Damascus also agreed to tackle several other thorny issues that have strained relations between them.
These include longstanding Lebanese demands to work on the question of missing Lebanese prisoners in Syria and to demarcate borders, although the contentious issue of the disputed Shebaa Farms not part of the negotiations.
However it is not clear when the embassies will be opened or when work on borders and prisoners will finally produce results.
While Syrian commentators have been heralding the announcements as a sign of the solid relations between "sisterly countries", some Lebanese, sceptical of Syria's intentions, feel short-changed.
Fariz Suaid, from the anti-Syrian "14th March group", said the summit yielded much less than expected. Syria, he suggested was not engaging fully in some issues.
Many Lebanese feel that although Damascus has given some ground on the question of diplomatic recognition, it has been negotiating from a position of strength.
Syria may be emboldened by signs that it may be slowly emerging from its diplomatic isolation by the international community.
The Syrians are holding indirect peace talks with Israel and last month, the Syrian President was received in Paris by President Nicolas Sarkozy.
And while Syria may no longer have troops in Lebanon, it still has considerable influence over Lebanese affairs. Its close ally, Hezbollah, is now part of the national unity government, and has the power of veto.
The two countries may be taking steps towards a more equal relationship, but there is still a long way to go.