MPs have voted in favour of recognising Palestine as a state alongside Israel.
The House of Commons backed the move "as a contribution to securing a negotiated two-state solution" - although less than half of MPs took part in the vote.
The result, 274 to 12, is symbolic but could have international implications.
Ministers abstained on the vote, on a motion put forward by Labour MP Grahame Morris and amended by former Foreign Secretary Jack Straw.
Middle East Minister Tobias Ellwood said the UK reserved the right to recognise Palestine when it was "appropriate for the peace process".
In 2012 the UN General Assembly voted to upgrade the Palestinians' status to that of "non-member observer state". Some 41 nations - including the UK - abstained.
Current UK government policy is that it "reserves the right to recognise a Palestinian state bilaterally at the moment of our choosing and when it can best help bring about peace".
During the Commons debate on Monday Mr Morris said recognising Palestine as a state would be a "symbolically important" step towards peace, saying relations between Israelis and Palestinians were "stuck at an impasse".
The full motion stated: "That this House believes that the government should recognise the state of Palestine alongside the state of Israel as a contribution to securing a negotiated two-state solution."
Explaining Labour's support, shadow foreign minister Ian Lucas said it would "strengthen the moderate voices among the Palestinians who want to pursue the path of politics, not the path of violence".
"This is not an alternative to negotiations. It is a bridge for beginning them," he said.
Conservative Nicholas Soames said: "I'm convinced that to recognise Palestine is both morally right and is in our national interest."
Another former foreign secretary, Conservative MP Sir Malcolm Rifkind, said he too wanted to see a two-state solution but added: "Symbolism sometimes has a purpose. It sometimes has a role. But I have to say you do not recognise a state which has not yet got the fundamental ingredients that a state requires if it's going to carry out its international functions and therefore, at the very least, I would respectfully suggest this motion is premature."
It is convention that ministers abstain when voting takes place on a backbench MP's motion and those of both the Liberal Democrat and Conservative parties did so. It is, however, Lib Dem policy to support recognition of Palestinian statehood.
The government is not bound to do anything as a result of the vote. Mr Ellwood said the timing of when the UK opts to accept Palestinian statehood was "critical", insisting: "You can after all only play this card once."
He added that Israel lived "in a tough neighbourhood" and had the right to defend itself. But he said its recent expansion settlements in the West Bank and East Jerusalem made it hard for its friends, including the UK, to make the case that it was committed to peace.
Mr Ellwood also said: "Only an end to the occupation will ensure that Palestinian statehood becomes a reality on the ground. The UK will bilaterally recognise a Palestinian state when we judge that it can best help bring about the peace."
The vote comes amid moves elsewhere in Europe to recognise Palestinian statehood officially, more than 100 countries having done so.
Israel says moves to recognise Palestine are premature and undermine efforts to reach a peace settlement between the two sides.
But Palestinian officials say they have been forced to pursue measures including seeking greater recognition internationally because a succession of peace talks has failed.
Labour has twice called on the government - in 2011 and 2012 - to back Palestine's request for official state recognition at the UN.
The full list of how MPs voted can be read on Hansard's Official Record of the debate.