He announced his resignation in a 10 minute speech, broadcast live on television, as the Soviet Union passed into history.

It has been replaced by the Commonwealth of Independent States (CIS).

The 60-year-old appeared solemn but composed.

"Due to the situation which has evolved as a result of the formation of the Commonwealth of Independent states I hereby discontinue my activities at the post of president of the Union of Soviet Socialist Republics," he said.

He said he was resigning on a matter of principle, adding the decision to dismantle the state should have been made "on the basis of popular will".

Mr Gorbachev, highly regarded abroad but not at home, listed his achievements.

"Free elections have become a reality. Free press, freedom of worship, representative legislatures and a multi-party system have all become a reality," he said.

Human rights, free enterprise and the removal of nuclear threat were also now in place, he said.

He added that some mistakes had been made but ended by offering his best wishes to the people.

Tributes

Control of the former Soviet Union's nuclear force now passes to Boris Yeltsin, the Prime Minister of Russia which inherits the USSR's permanent seat on the United Nations' Security Council.

The Soviet red flag, bearing the hammer and sickle, was lowered over the Kremlin and in its place the Russian Federation's tricolour was raised.

It was an image mirrored at Soviet embassies around the world.

US president George Bush, who was told of the changes by Mr Gorbachev by telephone, joined other world leaders in paying tribute to him.

America is expected to recognise the existence of Russia tomorrow.

British Prime Minister John Major, speaking at Chequers, said Mr Gorbachev helped make the world a safer place.

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