State media says China's top legislature has sanctioned the ruling Communist Party's decision to allow couples to have a second child if one parent is an only child.
It is the first major easing in three decades of the restrictive national birth planning policy.
Implemented around 1980, China's birth policy has limited most couples to only one child, but has allowed a second child if neither parent has siblings or if the first born to a rural couple is a girl.
The official Xinhua News Agency said the standing committee of the National People's Congress approved a resolution Saturday to formalise the party decision.
It says the national lawmaking body has delegated the power to provincial people's congresses and their standing committees to implement the new policy.
The national legislature also voted to abolish a much-criticised penal system that allowed police to lock up people for up to four years without due process.
The standing committee of the National People's Congress adopted a resolution to abolish the re-education labour system, formalizing a November decision by the Communist Party, according to the official Xinhua News Agency and the state-run China Central Television.
State media said all those serving time in the labour camps will be set free starting Saturday, but the penalties handed out before the abolition should still be considered legitimate - a provision aimed at preventing the victims from suing the state and seeking redress.
Established to punish early critics of the Communist Party, the penal system was reworked to focus on petty criminals. In recent years, however, it had been used by local officials to deal with people challenging their authority on issues including land rights and corruption.
"It has become a tool of revenge and retaliation," Wang Gongyi, a former director of a research institute under the Chinese Ministry of Justice, said earlier this year.
The country's senior leadership signaled its intention to end the system in January, and labor camps throughout China stopped admitting people since March, legislative official Lei Jianbin told CCTV on Saturday.
Yet, Chinese officials had remained coy about their plans, including a timetable, to dismantle the penal system until November when the party announced it would abolish the camps following a high-level meeting.