India's southern state of Andhra Pradesh has formally split in two, with its northern area carved out to create a new state called Telangana.
The move followed prolonged protests by residents of Telangana, who felt the region had long been neglected.
Telangana, which officially came into existence at midnight local time, becomes the country's 29th state.
With a population of 35 million, it comprises 10 former districts of Andhra Pradesh and the city of Hyderabad.
K Chandrasekhar Rao, of the Telangana Rashtra Samithi party (TRS), which for 14 years spearheaded the movement for separation and will form the new state's first government, has been sworn in as the chief minister for Telangana.
Hyderabad, which forms the joint capital of the two states for the next 10 years, was covered with pink balloons, banners and flags to mark Telangana's statehood, says BBC Hindi's Zubair Ahmed. Pink is the colour of the TRS.
"The sacrifice of our people and the youth who led the movement has culminated in the formation of a new state. It is a historic day for us," Krishank, a local student leader, said.
He said providing jobs to thousands of young people should be a top priority of the new government.
But there are also opponents of the division. One, A Ravi, said he was unhappy that his "beloved state had been torn apart".
"It's a sad day because we speak the same language and have no distinct identity. Politicians played a dirty role in dividing the state into two," Mr Ravi, an info-tech professional, told BBC Hindi.
Andhra Pradesh and Telangana share the same language of Telugu.
Correspondents say the large state of Andhra Pradesh was deeply divided economically, with people in the less-developed Telangana region feeling largely neglected.
India's upper house approved a bill to carve out the new state in February, despite opposition from lawmakers in the Congress Party, which governed Andhra Pradesh.
The then chief minister of Andhra Pradesh state, Kiran Kumar Reddy, resigned after parliament approved the bill.
Opponents are unhappy that Hyderabad, which is home to many major information technology and pharmaceutical companies, would become a shared state capital.
After 10 years, Andhra Pradesh is expected to develop a new capital.