First Minister Alex Salmond launched a White Paper for a vote on constitutional reform, and declared: "It's time for the people to have their say on Scotland's future."
The St Andrew's Day announcement was aimed at paving the way for the referendum which the Scottish National Party hopes to see next year.
But opposition parties in the Scottish Parliament have vowed to block the move.
The wording of the referendum is not disclosed in today's White Paper.
But it sets out four possible scenarios for Scotland.
These are: no change in the present set-up; more devolution as recommended by the Calman Commission; a further degree of devolution; and full independence.
Mr Salmond said: "The debate in Scottish politics is no longer between change or no change - it's about the kind of change we seek and the right of the people to choose their future in a free and fair referendum."
Mr Salmond went on: "This historic document sets out the case for Scottish independence with unprecedented depth and clarity."
The First Minister said Scottish popular opinion had moved "far beyond" wanting no change.
And he insisted the Calman Commission on devolution - supported by Labour, the Tories, the Liberal Democrats, but not the Nationalists - fell short of public need.
Mr Salmond said Westminster was "refusing" to make any progress on issues like devolving control over airguns this side of an election and "substantial doubt" as to what would happen after an election.
He said: "This White Paper charts the route to progress for Scotland and we are calling on people of all parties and none who want real and substantive additions to the powers of the Parliament to rally to the referendum campaign.
"That is why we are open to including the option of such powers on the referendum ballot paper, alongside independence."
Mr Salmond said that, after a year of devolution, there was "a clear and consistent demand" for more constitutional "progress" and extending the powers of the Scottish Parliament.
"The vast majority of people want to expand the responsibilities of the Parliament so that we have more powers to do more for Scotland," he said.
These included the economic and financial clout needed to fight recession, the right to "speak up for Scotland" in Europe, and the ability to remove Trident nuclear weapons from Scotland.
The SNP hopes to publish a referendum Bill early next year, with a referendum being staged about 12 months from now.
But opposition parties, who outnumber the SNP in the Scottish Parliament, have repeatedly vowed to block the plan.
And Scottish Labour leader Iain Gray insisted today: "This is simply not the time for a referendum."
The White Paper published today, entitled Your Scotland, Your Voice, runs to 176 pages.
A foreword from Mr Salmond on the opening page states: "I ask every Scot to pause and reflect, not just on what kind of country we are but on the kind of country we could be, the kind of country we should be.
"I am committed to a new chapter in Scottish politics, one in which the story and the script is written by the people and not just by the politicians."
The appeal was originally made in August 2007 when Mr Salmond's administration launched the "national conversation" process which led to today's White Paper.
At the time of the 2007 launch, Mr Salmond was proposing a referendum with only one question - inviting voters to agree or disagree that the Scottish Government should negotiate a settlement with Westminster so that Scotland becomes an independent state.
The options set out in today's White Paper are more numerous, but the questions which would ultimately appear on the ballot paper have not yet been decided.
The White Paper sets out the four "broad options" for the future.
It states: "Independence would complete the responsibilities of the Scottish Parliament and Government while allowing existing structures and services to continue."
The White Paper continues: "Aspects of an independent Scotland would be familiar: services and entitlements continuing to be delivered; pensions and benefits continuing to be paid at a similar level as now.
"Services such as the NHS and education are already largely devolved and so would continue in much the same form as they do now.
"Over time, the Scottish Government and Scottish Parliament could develop and implement Scotland-specific solutions."
The White Paper sets out various policy areas, like management of the economy, agriculture and housing, and examines the implications for each under all four of the possible scenarios.
Under "full devolution" - the option that falls just short of independence - the Scottish Parliament would, for example, have control over taxes like inheritance tax and corporation tax and would be fully responsible for collecting the "vast majority" of revenues in Scotland - and the vast majority of spending in Scotland.
The White Paper said: "A remittance or subvention from Scotland to the United Kingdom would be required to cover common UK public goods and services such as defence and foreign affairs.
"The range of services paid for in this way would be subject to negotiation at the time of any revised settlement.
"In essence, this framework would be the maximum form of tax and policy devolution short of independence."
On broadcasting, the status quo would mean no change, the Calman Commission recommendations would see the appointment of the Scottish member of the BBC Trust become the responsibility of Scottish ministers, and "full devolution" could see more broadcasting powers for Scotland but within a UK framework similar to Catalonia and Spain, said the White Paper.
Under independence, Scotland would have full responsibility for broadcasting but "should continue to access BBC and other broadcasters from the United Kingdom".
As each policy area is examined in turn, the White Paper concludes that more devolution would be better than the status quo, even more devolution better still, and independence best of all.
Looking ahead to its hoped-for referendum, the White Paper acknowledges: "It is accepted that some voters do not wish Scottish ministers to take any steps to seek to extend the responsibilities of the Scottish Parliament.
"Therefore there will be an opportunity for those who do not support any extension of current responsibilities to express that view in the referendum."
The White Paper said that, despite the Scottish Government's preference for a single choice, it acknowledges there is support in Scotland for "a range of positions seeking a variety of increased responsibilities" for the Scottish Parliament.
A multi-option referendum might be more likely to command the support of other parties, and there is "some democratic advantage" in posing more than one question.
But the White Paper continues: "There is a problem in deciding what the other option should be."
The Calman Commission proposals fall short of an increase in responsibilities which would normally be seen as requiring referendum consultation - and there is "some doubt" as to whether the Calman proposals on tax are still supported by all the opposition parties.
The White Paper says there is support for further devolution short of independence, but backers of this have yet to frame it into the form of a question which could appear on a multi-option referendum.
It will be open to opposition parties to bring forward such a proposal, said the White Paper.
"If it were brought forward, the Scottish Government would be prepared to consider it as a serious option for inclusion in a multi-option referendum.
"Accordingly, the referendum Bill will be constructed so that the Scottish Parliament can, if it so chooses, offer the Scottish people the opportunity to vote for a proposal about further devolution of other responsibilities to the Scottish Parliament as part of a multi-option referendum, even though the Scottish Government does not favour this option and will not campaign for it."
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