Croatia has held a big military parade to mark the 20th anniversary of a key offensive in its independence struggle, while Serbia mourns the victims.
The Zagreb parade featured thousands of soldiers, military vehicles and jets, to celebrate Operation Storm in 1995.
The massive campaign saw Croatia's army retake the Serb-held Krajina region during the break-up of Yugoslavia, forcing many Serb civilians to flee.
Serbia is holding an official day of mourning on Wednesday.
'Forgiven not forgotten'
Serbian Prime Minister Aleksandar Vucic was among those taking part in a ceremony at a symbolic bridge separating Bosnia and Serbia on Tuesday evening.
"We have peace with Croatia and we are going to preserve it," he said.
"But today, we send a message that the crime should be forgiven but must not be forgotten."
In Croatia, thousands of spectators greeted the military parade, and other events were staged as victory celebrations on Tuesday.
Operation Storm ushered in the end of the 1991-95 war that in total claimed about 20,000 lives, both Croatian and Serb.
It dismantled the self-proclaimed Serb Republic of Krajina, where Serb rebels had staked out territory amounting to about a quarter of Croatia.
In the days that followed, property was destroyed and atrocities committed against those Serbs who remained.
At least three-quarters of around 200,000 Serb civilians who lived in the region fled.
Croatia is now a member of the European Union and Nato. Serbia, a traditional Russian ally, wants to join the EU and the negotiations are far advanced.