"We, the democratically elected representatives of the people, hereby declare Southern Sudan to be an independent and sovereign state," speaker James Wani Igga said, splitting Africa's largest country in two.
The declaration of independence affirmed the new state's democratic and multi-ethnic and multi-confessional character, and its commitment to friendly relations with all countries "including the Republic of Sudan", Mr Igga said.
The parliament speaker said as a "strategic priority," South Sudan would seek admission to the United Nations, the African Union, the east African bloc IGAD and other international bodies.
South Sudan's Salva Kiir was sworn in as president.
South Sudan's independence comes exactly six months after a referendum saw southerners vote almost unanimously to split with their former civil war enemies in the north.
For decades, until a peace agreement was signed in 2005, southern rebels fought successive wars with the north, leaving the region in ruins, millions of people dead and a legacy of mutual mistrust.
The independence ceremony is being held at the mausoleum of the late rebel leader John Garang, who died just months after signing the peace accord that ended Africa's longest-running conflict and opened the door to nationhood.
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