Hewlett-Packard will soon start selling its own-brand portable music player based on Apple's best-selling iPod.
Even the iPod earbuds reflect its distinctive design
The news comes as Apple announces a mini addition to the iPod family that can hold about 1,000 songs and will go on sale in February.
Hewlett-Packard branded music players are due to appear in the summer.
The agreement marks a change for Apple which has formerly been reluctant to licence its technology.
Under the terms of the deal Apple will manufacture the devices for HP which will then market them via its own chain of retailers and resellers.
No information has been released about what the player will look like or how much it will cost. HP has only said they will be priced "competitively".
Apple's iPod is currently the best-selling portable music player and the company said it had now sold more than 2 million of the gadgets.
The move is seen as an attempt by Apple to make the iPod the dominant portable music player and establish its method of formatting music files as the industry standard.
"We're taking a big step today to further the iPod," said Phil Schiller, head of worldwide marketing for Apple.
In the past Apple has jealously guarded its technology and resisted the temptation to let others make computers based on its hardware.
In the late 1990s it effectively killed off attempts to make clones of its computers by demanding high licence fees.
Also included in the deal was an agreement to bundle the iTunes music download services onto HP computers.
HP boss Carly Fiorina said the agreement was struck to help it broaden its strategy to help consumers do more with with digital media such as movies, music and images.
Like many other PC makers, HP has ambitions to turn the home computer into a digital entertainment hub.