US President George W Bush has welcomed the congressional approval of a law which will allow the US to export civilian nuclear fuel to India.
Energy-hungry India needs nuclear power
The legislation will now be sent to Mr Bush to be signed into law. It was approved by the Congress last week.
The vote follows an agreement earlier this year between Mr Bush and the Indian Prime Minister, Manmohan Singh.
The accord has been hailed as historic by some, but critics say it will damage non-proliferation efforts.
The "bipartisan legislation .. will strengthen the strategic relationship between America and India and deliver valuable benefits to both nations," Mr Bush said in a statement.
"I am pleased that our two countries will soon have increased opportunities to work together to meet our energy needs in a manner that does not increase air pollution and greenhouse gas emissions, promotes clean development, supports non-proliferation, and advances our trade interests," he said.
Under the deal, energy-hungry India will get access to US civil nuclear technology and fuel, in return for opening its civilian nuclear facilities to inspection.
But its nuclear weapons sites will remain off-limits.
The Congress decision has been welcomed in Delhi as an historic moment in relations between the two countries.
NUCLEAR POWER IN INDIA
India has 14 reactors in commercial operation and nine under construction
Nuclear power supplies about 3% of India's electricity
By 2050, nuclear power is expected to provide 25% of the country's electricity
India has limited coal and uranium reserves
Its huge thorium reserves - about 25% of the world's total - are expected to fuel its nuclear power programme long-term
Source: Uranium Information Center
Once on opposite sides of the Cold War fence, they have become allies with close economic, political and even defence ties.
Correspondents say that India sees the deal as a tacit acceptance of its emergence as a global nuclear power.
But some say that by making an exception for India, the US will find it difficult to rein in the nuclear ambitions of North Korea and Iran.
The proposed agreement reverses US policy to restrict nuclear co-operation with Delhi because it has not signed the nuclear Non-Proliferation Treaty (NPT), and has twice tested nuclear weapons in 1974 and 1998.
Mr Bush finalised the agreement during a landmark trip to India in March.
US Senate and House of Representatives committees backed the deal in June.
Critics of the deal say it could boost India's nuclear arsenal and sends the wrong message to countries like Iran, whose nuclear ambitions Washington opposes.
India has made clear that the final agreement must not bind it to supporting the US policy on Iran and does not prevent it from developing its own fissile material.