Brazil's Supreme Court has voted overwhelmingly in favour of allowing same-sex couples the same legal rights as married heterosexuals.
The decision was approved by 10-0 with one abstention.
The ruling will give gay couples in "stable" partnerships the same financial and social rights enjoyed by those in heterosexual relationships.
Brazil is the world's most populous Roman Catholic nation and has an estimated 60,000 gay couples.
The ruling makes Brazil one of very few South American nations, after Argentina and Uruguay, to allow gay unions with benefits similar to those afforded a heterosexual married couple.
"The freedom to pursue one's own sexuality is part of an individual's freedom of expression," said Justice Carlos Ayres Britto, the author of the ruling.
Gay activists welcomed the decision, saying it marked an "historic day" for the country.
"The degree of civilisation of a country can be measured by the way people in a nation treat their homosexual community," Claudio Nascimento, head of Rio de Janeiro state's Gay, Lesbian and Transsexuals Committee said, according to O Globo.
From now on same sex couples will be able to register their civil partnerships with solicitors and public bodies, giving them proper inheritance and pension rights.
However, the landmark ruling stops short of recognising gay marriage, which could involve public or religious ceremonies.
Brazil's Roman Catholic Church had argued against the decision to allow civil unions, saying the only union referred to within Brazil's constitution was that between a man and a woman.
But the country's recently elected President Dilma Rousseff has made the issue one of her big social policy reforms.
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