The Cypriot president and the Turkish Cypriot leader have agreed to resume talks on reunifying the island.
The deal was struck at a meeting between Demetris Christofias and Mehmet Ali Talat in Nicosia - the first such high-profile talks since 2006.
The two men also agreed to reopen a key crossing in the divided capital.
Greek and Turkish Cypriots have been divided since 1974, when Turkey deployed troops after a coup by Greek Cypriots who wanted union with Greece.
"This is a new era we are starting for the solution of the Cyprus problem," Mr Talat said after the meeting in a UN buffer zone near the abandoned Nicosia airport.
"We shall try our utmost in order to come to an agreed solution for the interest of the Cypriot people, both communities, as soon as possible," President Christofias said.
"We have a vision that the Turkish Cypriots and the Greek Cypriots are children of the same island"
In a joint statement, the leaders said they agreed that advisers from both sides would meet next week to set up groups to work out detailed agendas for the peace talks.
Mr Christofias and Mr Talat said they would meet in three months' time to "review the work of the working groups and technical committees and using their results to start fully fledged negotiations".
The talks would be held under the UN auspices, the statement added.
Mr Talat said that the Nicosia talks "didn't mention anything about the basis or the parameters of the [Cyprus] solution".
Crossing re-opening
Peace talks have been stalled since 2004, when Greek Cypriots rejected a UN peace plan that was backed by Turkish Cypriots.
Mr Talat favours the plan that proposed making Cyprus a federation of two states with a loose central government.
Mr Christofias, who was elected last month, prefers discussions to build on an agreement reached in July 2006.
This focused on individual confidence-building measures and practical areas where progress could be made.
In Nicosia, the two leaders also agreed to reopen the crossing at Ledra street, a pedestrian thoroughfare that runs along Nicosia's dividing line.
The street has come to symbolise the partition of the island.
The island's partition has long stood as an obstacle to Turkey's bid to join the EU.
The Greek Cypriot south, which joined the EU in 2004, holds veto rights over Turkey's accession.
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