The Ulster Defence Association has stood down part of its organisation, the Ulster Freedom Fighters.
The UFF units have been ordered to stand down
UFF weapons were being put beyond use, it said, but stressed this did not mean they would be decommissioned.
The UDA murdered more than 400 people during the Troubles - the majority were claimed by the UFF, widely regarded as a cover name for the UDA.
In its Remembrance Sunday statement, UDA leaders issued a strongly-worded attack on criminals in loyalist areas.
The group said anyone with information about crime should pass this to the police.
In its statement, the loyalist paramilitary group said: "The Ulster Defence Association believes that the war is over, and we are now in a new democratic dispensation that will lead to permanent political stability.
"But we believe the political parties and the political institutions are themselves still in a period of transition."
One of the UDA's leaders, Jackie McDonald, added: "90% of people in the loyalist community don't want de-commissioning."
Jackie Meehan, whose father Patrick was murdered by the UDA in 1976, said the guns must be handed over.
"I just look at some of the things the UDA get up to: blackmail, extortion, intimidation, drug pushing, prostitution," he said.
"How are they going to walk away from these vices? They need these guns to keep these vices and their own people intact."
Northern Ireland Secretary Shaun Woodward welcomed the UDA statement, but said it needed to lead on to decommissioning of the paramilitary group's weapons.
"They will be judged by their actions, not their words," he said.
Arms move urged
The UDA's move comes weeks after Social Development Minister Margaret Ritchie announced she was to cut off £1.2m in loyalist funding unless the UDA decommissioned its weapons in 60 days.
In a statement on Sunday, Ms Ritchie said: "I welcome the positive aspects of this statement, however, it is disappointing that there is still no intention on the part of the UDA to decommission its weapons."
Alliance leader David Ford also urged a move on arms.
"It is has to verifiably decommission weapons and not just state that they are beyond use," he said.