The announcement, published in the Basque separatist newspaper Euskaki Informacion, followed weeks of speculation that the rebel group was close to declaring a truce that would offer the chance of peace in Spain's Basque country for the first time in decades.
Eta set no conditions for observing the ceasefire but warned it would end it in the event of a "confrontation" with the government.
The example of Northern Ireland would certainly have had considerable effect in swaying the Eta leadership. After the Northern Ireland peace agreement was forged earlier this year, the Basque separatist group said it was "ready to learn" from the peace process. Last night's four-page announcement, written in the Basque language, also makes references to the Good Friday peace agreement. The communique said "new political majorities" are forming in the Basque country and that because of this Eta is in a position "to take risks".
This was apparently in reference to a weekend initiative in which moderate Basque nationalist parties, a mainstream leftist coalition and grassroots groups joined Eta's political wing, Herri Batasuna, in calling for peace talks to end the bloodshed in the Basque country.
The centre-right government of the Prime Minister Jose Maria Aznar rejected that appeal, reiterating its stance that talks with Eta are impossible until the group renounces violence for good.
The Interior Minister Jaime Mayor Oreja warned on Monday that an Eta ceasefire would be an electioneering stunt designed to draw more votes for Herri Batasuna in Basque regional elections scheduled for 25 October.
The moderate nationalist government in the Basque country has consistently called on the separatists to give up violence but has not made this a condition for peace talks.
This is the first time Eta has announced an open-ended ceasefire. Its longest cease-fire came in 1989 during what were supposed to be secret peace talks with the Spanish government, held in Algiers. The talks went nowhere and Eta resumed its violent campaign for independence.
The last time Eta attacked was on 25 June of this year when it killed a town councillor of the ruling Popular Party in the Basque town of Renteria. He was the sixth person killed by Eta this year.
Traditionally Eta has gone after military personnel and police but starting in July of last year its preferred targets became ruling party councillors in retaliation for a crackdown by the Aznar government.
Eta, whose name is a Basque-language acronym standing for Basque Homeland and Freedom, last declared a truce in mid-1996. It lasted one week.
Eta's Bloody History
n 1959 Eta is founded with the aim of establishing independence for the Basque country.
1961 Violent campaign begins with an attempt to derail a train transporting politicians.
1968 Eta claims first victim, Meliton Manzanas, a secret police chief in San Sebastian.
1978 Eta's political wing, Herri Batasuna, is founded.
1980 118 people killed in Eta's bloodiest year so far.
1995 Attempt to assassinate the leader of the opposition Popular Party (now Prime Minister), Jose Maria Aznar, with a car bomb.
1996 Right-wing Popular Party wins general election. Eta views the party as successor to General Franco's dictatorship.
July 1997 Eta kidnaps and kills Basque councillor Miguel Angel Blanco, sparking national outrage and bringing six million Spaniards on to the streets.
December 1997 23 leaders of Herri Batasuna jailed for seven years for collaborating with Eta.
April 1998 Northern Ireland peace agreement signed. Eta is understood to have been heavily influenced by the peace process.
June 1998 The latest Eta death as a car bomb kills Popular Party councillor Manuel Zamarreno.