The proposed law, which is considerably tougher than equivalent legislation passed in neighbouring Estonia and Lithuania, is certain to enrage nationalist hardliners in Moscow, who have long claimed human rights violations against Latvia's ethnic Russian community.
It will also attract fierce criticism in Latvia itself: from ethnic Russians claiming it is discriminatory; and from Latvian nationalists, convinced it is too soft on the people they still describe as 'colonialists'.
'This is the most important - and divisive - issue in Latvia today,' said one Western observer in Riga. 'I expect months of fierce debate before it finally comes into force.'
The extent of that division was reflected in the fact that no fewer than five draft citizenship laws were presented to parliament when it began debating the issue. At the two extremes, the drafts envisaged either immediate, unconditional citizenship for all residents or, effectively, a permanent bar on the vast numbers of mainly ethnic Russians brought into the country after it was annexed by Stalin in 1940.
In the end, the bill finally approved in the early hours of yesterday morning was hailed as 'moderate' by the ruling Latvian Way party. It stipulates that citizenship can only be granted to people who have lived at least 10 years in the country, can pass a language test and swear an oath of loyalty to Latvia. Former KGB or Soviet army officers will be permanently barred. The bill also proposes 'naturalisation quotas', the precise nature of which was left vague.
With ethnic Latvians now making up only 52 per cent of the 2.6 million population, many fear blanket citizenship rights could result in their becoming a minority in their own country. In Riga, where two-thirds of the population is non-Latvian, government representatives insist special criteria have to be applied.
The new law, not expected to be finally passed until next spring, will be carefully scrutinised by the Council of Europe, which has yet to rule on admitting Latvia as a member.