The John Paul Getty Museum has agreed to return 40 allegedly looted antiquities to Italy including a 5th-century BC statue of Aphrodite, Italian Culture Minister Francesco Rutelli announced on Wednesday.
The accord with the Californian museum resolves a long and bitter dispute over the antiquities, with Italy initially demanding the return of 49 and the Getty offering to hand back no more than 26.
Talks on the disputed artefacts hit a crisis point last year when the Italian government threatened to cut ties with the museum unless they were returned.
One of the most important antiquities is the Aphrodite, believed to be from the ancient Greek city of Morgantina in Sicily.
The Getty agreed to give back the statue, a touchstone of its collection, but not until 2010.
As for the most disputed object, a 3rd-century BC bronze athlete dubbed the 'Getty Bronze', the two sides agreed to postpone a decision until legal proceedings on the case under way in Italy have been completed.
Prosecutors in the north Adriatic town of Pesaro have asked that the statue be seized, arguing that it was smuggled out of Italy illegally.
A court must now rule on the case.
The bronze, which has been attributed to the famous Greek sculptor Lysippos, was found in the sea near the Adriatic port of Fano in 1964.
The Getty museum claims the statue, which it acquired in 1977, was found in international waters and so does not belong to Italy.
Italy does not dispute that the bronze was outside territorial waters when it was discovered but claims that it was taken out of Italy illegally.
The Italian culture ministry statement stressed on Wednesday that "both sides are satisfied that, after long and complex negotiations, an agreement has been reached".
It said the accord was a turning point which would lead to a "renewed spirit of collaboration" between Italy and the Getty, which is America's wealthiest art institution.
Italy and the Getty agreed to bolster their cultural relations through the loaning of important art works, joint exhibitions, research and conservation projects.
The deal with the Getty is the third between Italy and major US institutions.
The Metropolitan Museum of Art in New York and the Boston Museum of Fine Arts have agreed to return key parts of their classical collections in return for loans of equivalent value.
