The UK has agreed to a fluid border between Gibraltar and Spain, the government has announced.
The deal means checks will no longer be required on people crossing between the two.
It clears the way to finalise a post-Brexit deal on the territory with the EU.
There will be dual border control checks for arrivals by air at Gibraltar airport, carried out by Gibraltar and Spanish officials.
Foreign Secretary David Lammy said the Government has "secured a practical solution which safeguards sovereignty, jobs and growth".
In a message on X, the Foreign Secretary said: "Gibraltar's economy and way of life was under threat.
"Today we have secured a practical solution which safeguards sovereignty, jobs and growth.
"Working in lockstep with Fabian Picardo we have ensured Gibraltar's interests - as part of the UK family - are at the heart of this agreement."
Gibraltarian chief minister Fabian Picardo called the deal a "historic agreement".
In a message on X, Mr Picardo said: "An agreement for the future relationship between the EU and the UK in relation to Gibraltar is now a reality. It is a historic agreement."
President of the EU Commission Ursula von der Leyen also welcomed the deal.
She said: "It safeguards the integrity of Schengen and the Single Market, while ensuring stability, legal certainty and prosperity for the region."
Talks on rules governing the border have been ongoing since Britain left the European Union in 2020.
