The Prime Minister said she aims to reach a deal with the EU by the end of the two-year maximum timetable allowed by Article 50.
But she said once a deal is arranged, it will be implemented with a "phased approach, delivering a smooth and orderly Brexit".
Ms May said she wanted to avoid a "disruptive cliff edge" for businesses when Britain leaves the EU.
"It is in no one's interests for there to be a cliff edge for business or a threat to stability as we change our existing relationship to a new partnership with the EU," Ms May said in her speech.
"By this I do not mean that we will seek some form of unlimited transitional status in which we find ourselves stuck forever in some kind of permanent political purgatory," she said.
She wanted to have struck a new deal with the EU by the end of a two-year period for negotiations to leave the bloc.
"From that point onwards, we believe that a phased process of implementation, in which both Britain and the EU institutions and member states prepare for the new arrangements that will exist between us, will be in our mutual self interest," she added.
She said: "We will seek to avoid a disruptive cliff edge and we will do everything we can to phase in the new arrangements we require as Britain and the EU move towards our new partnership."
The Prime Minister was listing her "12 principles" which will guide Britain's negotiating position after it triggers Article 50 at the end of March, beginning the two-year process of leaving the bloc.
She said: "These are the objectives we have set:
"Certainty wherever possible. Control of our own laws. Strengthening the United Kingdom.
"Maintaining the common travel area with Ireland. Control of immigration. Rights for EU nationals in Britain and British nationals in the EU. Enhancing rights for workers.
"Free trade with European markets. New trade agreements with other countries. A leading role in science and innovation. Co-operation on crime, terrorism and foreign affairs. And a phased approach, delivering a smooth and orderly Brexit."
And she added: "This is the framework of a deal which will herald a new partnership between the UK and the EU. It is a comprehensive and carefully considered plan that focuses on the ends, not just the means, with its eyes fixed firmly on the future and on the kind of country we will be once we leave."
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