Iranian Ambassador Ali Akbar Salehi signed an additional protocol to the nuclear Non-Proliferation Treaty (NPT) at a ceremony at the Vienna headquarters of the UN nuclear watchdog, the International Atomic Energy Agency (IAEA).
"Iran has turned a new leaf," said IAEA director general Mohamed ElBaradei, who has urged that the accord was the only way for Tehran to prove that its atomic programme is purely peaceful.
"The protocol is an important tool for establishing confidence... to determine that the Iranian nuclear programme is totally peaceful... we will have the legal right to inspect all the installations and sites of Iran."
The inking came two months after the IAEA threatened to present its concerns over Iran's nuclear programme to the UN Security Council, which could impose sanctions.
"This is the opportunity for Iran to break a vicious circle that has been going on for 20 years," ElBaradei said.
Salehi told reporters: "It is a landmark event, I hope that now my country will not be exposed anymore to unfair and politically motivated accusations."
The Islamic republic has been accused by the United States of secretly trying to develop atomic weapons. In November the IAEA adopted a resolution condemning it for 18 years of covert nuclear activity.
Iran had long resisted signing the additional protocol but made an about-face under intense diplomatic pressure in October when the foreign ministers EU countries Britain, France and Germany visited the country.
Tehran then agreed to sign the additional protocol, hand over full details of its activities and suspend uranium enrichment.
The European Union Thursday welcomed the decision to sign, as did Russia, which is building Iran's first nuclear power reactor at Bushehr, in the southwest of the country.
"I welcome the signature today by Iran of the IAEA additional protocol as an important step in building international confidence about the peaceful nature of Irans nuclear programme," EU foreign policy envoy Javier Solana said.
The United States, for its part, said accession to the protocol "is only one step toward resolving the remaining open questions about Iran's nuclear programme."
"Given Iran's nearly two decades of deception, rigorous verification of the protocol's implementation by IAEA inspectors over a period of several years will be critical," Kenneth Brill, the US ambassador to the IAEA, said.
The 1997 protocol -- the international community's most powerful tool to curb the proliferation of nuclear arms -- obliges countries to provide the agency with much more precise information about their nuclear activities than is required under the NPT, which took effect in 1970.
And it authorises the IAEA to carry out more intrusive inspections of nuclear facilities.
Under the agreement, states commit to giving IAEA inspectors information about, and short-notice access to, all parts of their nuclear fuel cycle.
They must also offer access to any location where nuclear material is or may be present, and the IAEA may give as little as two hours' notice before it visits a site.
Iran's supreme leader Ayatollah Ali Khamenei, who has the final say on all matters of state, has given his blessing to the additional protocol.
This has eased fears that ratification could fall victim to bickering between conservatives and reformists, despite some influential conservativ suggesting Iran pull out of the NPT.
The face-saving spin put on the climbdown in politically-torn Tehran is that the country has secured its right to generate nuclear energy and that the IAEA will not violate national sensibilities.
ElBaradei Thursday hinted that Iran could be rewarded with the lifting of a long-standing ban on importing nuclear equipment.
The inking of the protocol "could ease the export of nuclear technology by the European countries," he said.