More than 30 nations, including the United States, have formally recognised Libya's main opposition group as the country's government.
They declared that the regime of Libyan leader Muammar Gaddafi is no longer legitimate.
In a final statement following a meeting in Istanbul, Turkey, of the so-called Contact Group on Libya, the nations said the "Gaddafi regime no longer has any legitimate authority in Libya", and that Gaddafi and members of his family must go.
The group said it would deal with Libya's main opposition group - the National Transitional Council, or TNC - as "the legitimate governing authority in Libya" until an interim authority is in place.
The recognition of the Libyan opposition as the legitimate government gives rivals of Gaddafi a major financial and credibility boost.
Diplomatic recognition of the council means that the US will be able to fund the opposition with some of the more than 30 billion dollars (£19 billion) in Gaddafi-regime assets that are frozen in American banks.
US Secretary of State Hillary Clinton said: "The United States views the Gaddafi regime as no longer having any legitimate authority in Libya. I am announcing that, until an interim authority is in place, the United States will recognise the TNC as the legitimate governing authority for Libya, and we will deal with it on that basis."
The National Transitional Council won international recognition after it said it would abide by its commitments and find a way forward for a truly democratic Libyan government, a senior US official said.
The assurances included upholding the group's international obligations, pursuing a democratic reform process that is both geographically and politically inclusive, and dispersing funds for the benefit of the Libyan people.
The recognition does not mean that the US diplomatic mission in the rebel-held city of Benghazi, Libya, is now an embassy. In addition to the US, the Contact Group on Libya includes members of Nato, the European Union and the Arab League.