President Barack Obama has paid tribute to the “extraordinary service” the Queen has given to Britain and the world during her lifetime.
In an address to mark the State banquet held in his honour the US leader also highlighted the unique bonds his homeland shares with Britain.
He told the guests at the white-tie dinner who included senior members of the monarchy, British and American governments and Hollywood stars: “As we approach the 10th anniversary of 9/11 I'm particular grateful for the solidarity that the United Kingdom has shown to America over the past decade.
“From that day to this you have been our closest partner in the struggle to protect our people from terrorism attacks and violent extremism from around the world despite very heavy sacrifices here.
“And allow me to pay tribute to the contributions of your military forces who have stood shoulder to shoulder with us for decades.”
In her speech, the Queen hailed the US as Britain's “most important ally”.
“I firmly believe that the strength of our links and many shared interests will continue to ensure that when the United States and the United Kingdom stand together, our people and other people of goodwill around the world will be more secure and more prosperous,” the Queen said on the first day of the US leader's first State visit to the UK.
Around 170 guests including the First Lady Michelle Obama, the Duke of Edinburgh, US Secretary of State Hillary Clinton and Prime Minister David Cameron and his wife Samantha listened to the Queen's address in the grand Buckingham Palace ballroom.
Actors Tom Hanks and Kevin Spacey, actress Helena Bonham-Carter and her director husband Tim Burton added some Hollywood glitz to the VIPs attending the lavish white tie dinner.
Former Prime Ministers Sir John Major, Gordon Brown and Tony Blair with wife Cherie were also invited.
The Queen provoked a large grin from Mr Obama and smiles from Kevin Spacey when she referred to the two nations' shared, but different language.
“Over the years, we have enjoyed some of America's most spectacular musical productions and any number of what we call films — and you might prefer to call movies.
“In return, British films and theatrical productions have achieved considerable success in your country.
“This exchange of people and projects has enlarged and invigorated our common language — although I think you will agree we do not always use it in quite the same way.”
Michelle Obama, sitting next to the Duke of Edinburgh, looked statuesque in a glamorous white evening gown with a cross over neckline and long white gloves.
Earlier, the American leader and his wife Michelle were given a warm welcome by the monarch and the Duke of Edinburgh, met newlyweds the Duke and Duchess of Cambridge and headed to Downing Street at the start of their three-day stay.
The visit comes at a time of close co-operation between Britain and the US on Libya, Afghanistan, counter-terrorism and the Middle East peace process.
At Westminster Abbey, following a wreath-laying at the Grave of the Unknown Warrior, First Lady Mrs Obama was heard to remark: “It's so nice to be back.”
Following a courtesy call on the Prime Minister and his wife Samantha, Mr Obama and Mr Cameron dropped in on a south London school. The two leaders teamed up to play table tennis against two teenage schoolboys.
During a windy welcome ceremony on the terrace of Buckingham Palace beforehand, Mrs Obama was left desperately protecting her modesty. Strong gusts had the First Lady clutching her dress as it threatened to blow up into the air during the event.
On the garden lawn were the guard of honour, 101 soldiers from the 1st Battalion, Scots Guards, and three officers lined up in two rows. Behind them were the band, pipes and drums of the Scots Guard. The guardsmen gave a Royal salute and then the US national anthem was played in honour of the President.
The Queen and the Duke took the Obamas on a tour of the picture gallery, where an exhibition of US memorabilia was put on display by the Royal Collection.
A motorcade of 19 cars and coaches, including a London ambulance, escorted the President in his armoured cadillac, known as ‘The Beast’, around the capital.
They are staying as guests of the Queen and will occupy the palace's Belgian suite, as is customary for visiting foreign heads of state.