Fireworks lit the sky and festive crowds gathered on the streets to mark Croatia's entry into the European Union, a major milestone some 20 years after the country won independence in a bloody civil war that shook the continent.
Croatia on Monday became the 28th EU member, and the first addition since Bulgaria and Romania joined in 2007.
Though enthusiasm for the country's achievement has been dampened by the EU's financial turmoil, it is a historic turning point for the small Balkan nation of 4.2 million, which endured years of carnage after declaring independence from the former Yugoslavia in 1991.
"As midnight struck, your country crossed an important threshold," European Council president Herman Van Rompuy told the cheering crowd in Croatia's capital Zagreb. "It will change the life of this nation for good."
"In the history of a nation, there are a few events such as this one," Croatia's president Ivo Josipovic said. "The accession of Croatia to the European Union is confirmation that each one of us belongs to the European democratic and cultural set of values."
A decade ago, when Croatia started negotiating the entry, the once war-torn country was overjoyed at the prospect of becoming a member of the European elite. With the EU in deep financial trouble and Croatia's own economy in recession for five consecutive years, the excitement has dimmed.
Thousands of people waving small EU and Croatian flags nonetheless joined celebrations across the country, including in Zagreb's main square. There, artists performed for some 100 visiting foreign leaders until midnight when big fireworks and the singing of Beethoven's Ode To Joy - the EU's anthem - marked the official entry into the bloc.
Customs posts were removed from Croatia's borders with EU neighbours Slovenia and Hungary, while EU signs and flags were put on its borders with non-EU states Bosnia, Serbia and Montenegro.
The festivities were much more modest and less jubilant than when Bulgaria and Romania - currently the EU's poorest states - became members. With the entry, Croatia becomes the third poorest country in the EU. With an unemployment rate hovering at around 20%, plunging living standards, endemic corruption among its political elite and its international credit rating reduced to junk, many Croats are not in the mood to celebrate.
Some economists have warned that Croatia could seek an EU financial bailout as soon as it becomes a member, but Croatia's foreign minister Vesna Pusic rejected those claims, saying that the country would qualify for help only if it is a member of the eurozone. "Croatia is not a member of the eurozone, and will not become a member of the eurozone until all the conditions are met," she said.