Pakistan's exiled former Prime Minister Nawaz Sharif will return home on 10 September to challenge President General Pervez Musharraf, he says.
Sharif's supporters in Pakistan were ecstatic to hear the news
Mr Sharif, deposed by Gen Musharraf in 1999, was speaking in London a week after Pakistan's top court defied the government to rule his return legal.
The United States reminded Mr Musharraf of his commitment to resign his army position before fighting elections.
"We expect him to honour that commitment" said a US spokesman.
The Pakistani leader "has said he's going to deal... with this issue in accordance with the constitution," said State Department spokesman Tom Casey.
From the White House, spokesman Gordon Johndroe said that the US primarily "seeks free and fair elections" in Pakistan.
Mr Sharif's announcement came as former PM Benazir Bhutto claims she is nearing a deal to share power with Gen Musharraf.
Correspondents have said Mr Sharif could still face jail if he goes home.
Mr Sharif said he planned to "start a decisive struggle against dictatorship", adding that Gen Musharraf should step down from the presidency and from his army post.
MUSHARRAF UNDER PRESSURE
9 March: Musharraf suspends chief justice for "abuse of power". Lawyers protest
April: Protests grow, amid clashes with police
12 May: 34 people die as rival political groups clash in Karachi
11 July: 102 people die when army storms radical Red Mosque in Islamabad
July-Aug: Sharp rise in suicide attacks by pro-Taleban militants
20 July: Supreme Court reinstates chief justice
9 Aug: Musharraf rejects emergency rule
23 Aug: Supreme Court says exiled ex-PM Nawaz Sharif can return
The former prime minister, who served two terms between 1990 and 1993 and from 1997 to 1999, said it would be "unfortunate" if Ms Bhutto made a deal with Gen Musharraf.
"I disagree with Ms Bhutto's current policy of shaking hands with a dictator," he said.
Referring to an electoral pact he signed with Ms Bhutto last year agreeing to fight Gen Musharraf's rule, he said: "She has given me her word, and she is going back on it."
Gen Musharraf is seeking support for presidential elections that could give him another five-year term.
But he is under pressure to reach a deal with the opposition after several Supreme Court rulings have gone against him.
'Right to return'
Under Pakistani law, prime ministers cannot serve more than two terms - which would disqualify both Ms Bhutto and Mr Sharif.
Mr Sharif has spent most of his exile in the UK and Saudi Arabia
Ms Bhutto wants this clause removed from constitution, and she says a deal will only be made with Gen Musharraf if he resigns his army role.
The general's spokesman said on Thursday he was considering standing down from his army position, but no decision had yet been made.
Mr Sharif was sentenced to life in prison for offences including tax evasion and treason after the 1999 coup.
Pakistani authorities say Mr Sharif promised to stay out of the country and away from politics for 10 years in exchange for his freedom.
But last week the country's Supreme Court ruled that he and his family had "an inalienable right to return and remain in the country as citizens of Pakistan".