It's been called a "new dawn" by the Welsh secretary, but others are less certain of the impact the Government of Wales Act will have.
By Brian Meechan
BBc Wales political reporter
There's the potential for more assembly powers but also the potential for conflict between Cardiff and London.
In future the assembly will ask the secretary of state for Wales to be given greater power to make laws in specific areas.
He or she will decide whether to take it to parliament, where the Commons and the Lords will vote on giving AMs that authority.
Lord Richard of Ammanford - responsible for an independent commission which called for full law-making powers for the assembly - welcomes the act but says it doesn't go as far as he would like.
"I can understand the disappointment of people who thought that what we suggested in my commission's report was sensible and the government are doing something different," he said.
The new law does not go far enough for Lord Richard
"The point is whether the thing is moving in the right direction and I don't think there's any doubt at all that, under this bill, the assembly will get greater competence.
"Now it won't get it quite the way I wanted it, and it won't get it quite to the extent I wanted it, and it won't get it quite as dramatically perhaps as I wanted it, but with any luck, if the scheme in the bill works, then the assembly will get more powers."
The new role of the secretary of state is challenged by opposition parties. As well as deciding whether the assembly will be allowed to ask parliament for the powers, he or she will also be able to stop some measures becoming law.
Plaid Cymru's Parliamentary leader Elfyn Llwyd is worried by that.
"There are plenty of areas within the bill for the secretary of state to intervene on the merest whim. It's a strange bill in many ways - it winds back devolution and it winds it forward as well and I'm not comfortable with that.
"And anybody who truly believes in devolution and Wales' own right to govern itself should be concerned."
The relationship between politicians in Cardiff Bay and their colleagues in London will be vital to the new process according to the leader of Welsh Liberal Democrats, Lembit Opik.
"I think that this piece of legislation is something of a landmark in moving more towards the kind of devolution that the Liberal Democrats and the pro-devolution parties wanted," he said.
"I guess over the next five or six years we will see further devolution. My biggest concern though is that we get an anti-devolution government, perhaps a Conservative government, and they put the anchors on it."
Shadow Welsh secretary Cheryl Gillan rejects any suggestion that her party, if in power in Westminster, would try to frustrate the assembly. But she is critical of the new measures.
"This act is capable of letting the Labour party say in Westminster, 'well we've not really given any more powers to the assembly', and in Cardiff to say, 'well actually we've given lots of extra powers, this is a ground breaking act for the people of Wales'. It is a piece of political chicanery I'm afraid."
While opposition parties are concerned about how the new way of governing Wales will work, Labour MPs, like Nia Griffith, say it has to be given time to bed-down.
"People will always think of the most controversial incidences but there is such a thing as consensus politics," she said.
"It works in the European context and what actually tends to happen is it moderates legislation. It tends to stop people going to one extreme or to the other extreme."
As the ink dries on the Government of Wales Act, politicians already have their sights set on what comes next. As the saying goes, devolution is a process, not an event.