The 27 leaders also granted Moldova the candidate status, while Georgia was left on the waiting list.
Ukraine has been granted official European Union candidate status, after being endorsed by the bloc's 27 leaders during a summit in Brussels.
Moldova was also granted candidate status while Georgia was left on the waiting list, pending reforms to ensure the country's political stability.
European Council President Charles Michel called it "a historic moment".
"Today marks a crucial step on your path towards the EU," he said.
Michel congratulated Ukrainian President Volodymyr Zelenskyy and Moldovan President Maia Sandu and added "our future is together."
Several other EU leaders took to social media to hail the moment.
"This path is not politics. I believe this is what will always be the starting point of Europe's new history. Europe without division. Europe without 'grey' zones. Europe that is truly united and that knows how to defend itself, its values, its future," Zelenskyy told his counterparts in a virtual address.
"However, I believe this decision is not only for Ukraine. This is the biggest step towards strengthening Europe that could be taken right now, in our time and in such difficult conditions, when the Russian war is testing our ability to preserve freedom and unity," he added.
President Sandu said the decision was "an unequivocal and strong signal of support for our citizens and Moldova's European future/"
Candidate status is a largely symbolic designation that recognises the selected country is on track to begin the lengthy, complex and often tortuous accession process.
The candidacy doesn't automatically guarantee the start of negotiations, let alone their conclusion. Over the past decades, Albania, North Macedonia, Montenegro, Serbia, and Turkey were granted candidate status, with very limited progress towards becoming members. Turkey received the title back in December 1999.
Despite the symbolism, the status does represent a geopolitical victory for Ukraine, a war-torn country that, until earlier this year, was never considered a serious contender to enter the EU. The move is also seen as a response to Russia's attempt to reinstate its sphere of influence.
"We owe this to the Ukrainian people. They’re fighting for our values," said French President Emmanuel Macron, adding the decision sends a "strong signal" to the Kremlin.
"27 times yes!" said German Chancellor Olaf Scholz. "Here's to good cooperation in the European family!"
The European Commission has put forward seven key reforms that Ukraine needs to carry out before the end of the year. The list includes the appointment of judges for the Constitutional Court, the fight against corruption and money laundering, the protection of national minorities and the implementation of a law meant to curb the excessive influence of oligarchs in the economy.
The Commission is expected to report back to the European Council by the end of the year about the pace of the reforms undertaken by Ukraine and Moldova, as well as Georgia, who could be granted candidate status at a later stage.
"I know that they will move swiftly," said European Commission President Ursula von der Leyen, reacting to the news. "They know how crucial this is for their democracies, their economies and their citizens."
EU leaders will use this report to determine the next step, which could include a more detailed roadmap to open formal negotiations. All major steps in enlargement policy require a unanimous vote of member states.
Accession talks are divided into 35 chapters and grouped into six main clusters: fundamentals; internal markets; competitiveness and inclusive growth; green agenda and sustainable connectivity; resources, agriculture and cohesion; and external relations.
The Commission has already warned that the entire process is merit-based and can be "reversed if the underlying conditions are not met anymore."
Asked about the fate of Georgia, who was simply given a "European perspective," President Michel encouraged the country to move forward with the necessary reforms to ensure stability.
“I’m confident if there’s a political will in the political landscape within Georgia, then it could be possible for them to make huge progress," Michel said. "They know exactly what’s needed to take steps in the right direction."
Thursday's breakthrough was widely expected to happen following a flurry of support over the past days and an outreach campaign by President Zelenskyy.
It comes a week after a joint trip to Kyiv by Scholz, Macron and Italian PM Mario Draghi. The leaders, speaking on behalf of the EU's three largest economies, delivered an unmistakable "yes" to granting Ukraine the coveted candidate status.
In his virtual speech on Thursday night, Zelenskyy thanked the 27 heads of state and government individually and paid tribute to the "heroes" defending Ukraine's independence.
"Although we remained formally outside the European Union, our country probably had the largest number of flags of a united Europe. They were in the hands of our people during the revolutions. They have been in the hands of our people in the trenches since 2014," he said.
"I believe that the flag of the European Union will be in every Ukrainian city that we have yet to liberate from the occupation of the Russian Federation. Ukrainian and European flags will also be together when we will be rebuilding our state after this war together."
This article has been updated to include new reactions and developments.