NATO leaders sealed a landmark agreement to hand control of Afghanistan over to its own security forces by the middle of next year.
The move puts the Western alliance on an "irreversible" path out of a deeply unpopular, decade-long war.
A NATO summit in Chicago formally committed to a US-backed strategy that calls for a gradual exit of foreign combat troops by the end of 2014.
However, the summit left major questions unanswered about how to prevent a slide into chaos and a Taliban resurgence after the allies are gone.
President Barack Obama acknowledged NATO's plan was fraught with risk even as he touted it as a sound approach.
Mr Obama and NATO partners sought to show their war-weary voters the end is in sight in Afghanistan - a conflict that has strained Western budgets as well as patience - while at the same time trying to reassure Afghans that they will not be abandoned.
Alliance leaders acquiesced to new French President Francois Hollande's insistence on sticking to his campaign pledge to withdraw French troops by 31 December, two years ahead of NATO's timetable. While there was no sign this would send other allies rushing for the exits, leaders could face pressures at home.
But despite a face-to-face encounter with Pakistan's president, Mr Obama failed to resolve a key dispute overhanging the summit - Islamabad's refusal to reopen supply routes to NATO in Afghanistan seen as vital to an orderly withdrawal.
The summit's final communique ratified plans for the NATO-led army to hand over command of all combat missions to Afghan forces by the middle of 2013 and for the withdrawal of most of the 130,000 foreign troops by the end of 2014.
The statement deemed it an "irreversible" transition to full security responsibility for fledgling Afghan troops, and said NATO's mission in 2014 would shift to a training and advisory role. "This will not be a combat mission," it said.
Doubts remain, however, whether Afghan forces will have the capability to stand up against a still-potent Taliban insurgency that Western forces have failed to defeat in nearly 11 years of fighting.
'Diligent progress' with Pakistan
Mr Obama spoke of "diligent progress" but no breakthrough with Pakistani President Asif Ali Zardari on the supply lines issue after they spoke briefly on the sidelines of the summit.
Frustrated NATO officials have also been trying to persuade Pakistan to reopen its territory to NATO supplies, which Islamabad has blocked since NATO forces killed 24 Pakistani soldiers in a cross-border incident last year.
With Europe's debt crisis hanging over the summit and many member-governments limited by austerity budgets, Mr Obama also struggled to pin down final commitments from allies for the $4.1 billion a year needed to support Afghan security forces.
The funding - which will undergird Afghan's capacity to fight the Taliban and is considered vital to a smooth NATO departure - was not expected to be fully realised at the summit, but alliance officials believe it will eventually be provided.
World leaders agree Greece must stay in eurozone
President Barack Obama said world leaders agree on the importance of Greece remaining in the eurozone.
Speaking at a press conference following the summit, he said he believed there was an increased resolve on the part of European leaders to tackle the eurozone crisis.
He also said it was crucial for European banks to be recapitalised and for there to be firewalls to protect countries against financial contagion.