The European Union set Albania on the road to membership today, granting the small Balkan state the status of candidate to join in recognition of recent reforms.
But it also warned the Albanian government that progress was conditional on further efforts.
Years of political polarisation have slowed democratic reforms in Albania and kept it behind some of its ex-Yugoslav peers.
But a change of government last September opened the way for an EU-backed reform push.
"Congratulations on candidate status just agreed," EU Enlargement Commissioner Stefan Fuele said on Twitter. "(It is an) acknowledgement of reform efforts, encouragement for more."
The decision must be confirmed by EU leaders at a Brussels summit on Friday.
#Albania congratulations on candidate status just agreed by Ministers: acknowledgement of reform efforts,encouragement for more.— Štefan Füle (@StefanFuleEU) June 24, 2014
It was the first major step on EU enlargement since European elections in May when eurosceptic and anti-immigration parties performed strongly, a development which could slow further expansion of the 28-nation bloc.
A NATO member of some three million people, Albania will have to meet further reform conditions to actually start negotiations on entry, a lengthy process that aims to bring the candidates' laws in line with EU rules and can take many years.
It will also face reluctance among many EU members to further enlargement of the bloc, fuelled by concerns over economic costs, rising euroscepticism and disappointment with democratic progress in the EU's latest members, Romania and Bulgaria.
As in those two Balkan countries, corruption and organised crime are major problems in Albania.
Underscoring caution in the EU, Germany's State Secretary for Europe Michael Roth said joining the EU was not automatic.
"Albania made some progress in the fight against corruption and rule of law. But there is a clear expectation. Without democratic structures ...without an independent judiciary, without a fight against corruption, there is no EU membership,"he told reporters before EU ministers took the decision in Luxembourg.
The Netherlands, Britain, Germany, France, the Czech Republic and Spain were the member states taking the toughest stance on demanding reforms from Albania, one EU official said.
In a statement, the EU said Albania had to address issues such as the use of fraudulent documents, money laundering, drug cultivation and human trafficking. Albanian Prime Minister Edi Rama said that, with the EU's decision, Albania had "regained its lost dignity in the eyes of international partners."
"It was not an easy job, Europe is not a door that opens easily. After the elections, things could have gone in another direction. The reason I am thankful to European leaders ... is that they stood by the project of Europe," he told reporters in the Albanian capital Tirana.
A dispute between the Czech Republic and Albania that had threatened to hold up EU candidate status for Albania was resolved today when Czech utility CEZ said it would receive €100m in a settlement.
Czech Prime Minister Bohuslav Sobotka said that before Albania could advance further in EU entry talks, it must remove problems in the areas of protecting basic union freedoms, the protection of investments, and the rights of states.
Having shed a Stalinist dictatorship, Albania escaped the wars that embroiled its northern neighbours in the former Yugoslavia in the 1990s, but a chaotic transition to capitalism has left the country mired in poverty and corruption.
Of its western Balkan peers, Albania joins Montenegro, Macedonia and Serbia as official candidates for membership. Croatia and Slovenia have already joined the bloc and Serbia and Montenegro have both begun accession talks.
Macedonia's bid is hostage to a row with neighbouring Greece over Macedonia's name. Bosnia and Kosovo are yet to be granted candidate status.