Kosovo's declaration of independence from Serbia in 2008 did not violate international law, top UN judges have ruled in a non-binding decision.
The International Court of Justice rejected Serbian claims that secession violated its territorial integrity.
Kosovo officials said it was now up to Serbia to talk to Kosovo as a sovereign state. Serbia said it would continue to defend its sovereignty.
The US and many EU countries support independence; Russia is opposed.
Addressing the court in The Hague, ICJ president Hisashi Owada said international law "contains no applicable prohibition" of Kosovo's declaration of independence.
"Accordingly, [the court] concludes that the declaration of independence on 17 February 2008 did not violate general international law," he said.
Ten of the ICJ's judges supported the opinion; four opposed it.
The BBC's Mark Lowen in Belgrade says other nations with secessionist challenges in their own backyards are likely to interpret the ruling with concern.
Earlier, the commander of the Nato-led peacekeeping force in Kosovo said its 10,000 troops were ready for any violence sparked by the ruling.
"On the field we don't have indications about nervousness, about any upcoming threat," said German Gen Markus Bentler of the Kosovo Protection force, K-for.
Sovereignty challenged
Serbian troops were driven out of Kosovo in 1999 after a Nato bombing campaign aimed at halting the violent repression of the province's ethnic Albanians, who constituted 90% of its two million population.
Kosovo was then administered by the UN until February 2008, when its parliament voted to declare independence.
So far 69 of the UN's 192 countries have recognised Kosovo as independent - they include the US, UK, neighbouring Albania and Croatia.
Those opposed include Russia, China and Bosnia.
At the start of the deliberations last December, Serbia's representatives argued that the move both challenged its sovereignty and undermined international law.
Kosovo's representatives warned that any attempt to reverse its independence might spark further conflict.
Although non-binding, the court's ruling is likely to provide a framework for diplomats to try to establish a working relationship between Serbia and Kosovo.
The dispute remains an obstacle to Serbia's hopes of joining the EU, and has hindered Kosovo's ability to attract foreign investment. Parts of northern Kosovo also remain tensely divided between ethnic Albanians and Serbs, and clashes occasionally erupt.
Before the ruling, Serbian Foreign Minister Vuk Jeremic told the BBC: "The first and foremost consideration for any democratic government in the world is the preservation of its own sovereignty and territorial integrity.
"We do expect that the court is not going to endorse the legality of the unilateral act of secession, because if they do so, then no border anywhere in the world where a secessionist ambition is harboured will ever be safe."
Meanwhile, the White House said in a statement that Vice-President Joe Biden had "reaffirmed the United States' full support for an independent, democratic, whole, and multi-ethnic Kosovo" during a meeting with Kosovo Prime Minister Hashim Thaci on Wednesday.