Both President Bill Clinton and his Chinese counterpart, Jiang Zemin, hailed the deal paving the way to Peking's membership of the WTO, as a "win-win" arrangement.
As negotiators from both sides celebrated with champagne a successful end of six days and nights of hard bargaining in Peking, China also expressed optimism that it could gain membership to the world body before the end of the year.
Trade officials in Washington and Geneva, however, are less confident of this. The major obstacle to that goal is the European Union, which still has to conclude its bilateral deal on Peking's WTO entry.
But diplomats in the Chinese capital said few issues remained outstanding after Washington's deal, and negotiations with Europe would resume on Friday.
Once in the global trading body, China will have to cut its import tariffs by a quarter, and open its markets to American banks, telecommunications firms, car financers, insurers and Hollywood film distributors. Foreigners will be able to invest in Chinese Internet companies, reversing a ban by Peking.
The deal sent stock prices in Hong Kong soaring to their highest level in more than two years, as investors looked to further integration into the world markets from China.
The US trade representative Charlene Barshefsky, who signed the agreement in Peking with China's Foreign Trade Minister, Shi Guangsheng, said the deal went further than providing access to China's 1.3 billion consumers and had political value in cementing shaky bilateral ties.
"This deal will help regularise trade between our two countries, assist in ongoing reform in China and act as an anchor for Sino-US ties, which are complex and fraught with difficulties," she said. "It will also strengthen the rule of law and basic rules of transparency in China which are critical to creating a more full-bodied and robust legal system in China."
The deal is good news for Mr Clinton, who had been criticised by business for walking away from a similar deal in April. "I think this is a good agreement for China, for America and for the world," he said at a press conference in Turkey, where he is attending an international summit. Mr Clinton must now persuade a hostile Congress to give China normal trade access to the US. Under US law, the Congress must vote each year on whether or not to give China "most favoured nation" status, which accords it the trade privileges given to WTO members. Unless Republicans can be persuaded to change this, trade between the US and China will continue to be hostage each year to angry debates.
Negotiators from both sides raced against the clock to hammer out a deal so that China could enter the body before a 30 November deadline, when ministers of the WTO's 134 member states meet in Seattle to launch a new trade round. Given the remaining agreements - with several developing countries as well as the EU and Canada - the documentation that must be completed and the need for ratification by China, it is still unlikely China will be a member of the WTO before 2000.