At a ceremony in Kabul on Monday, German Defence Minister Peter Struck said NATO's job was to ensure the country did not again become a safe haven for “terrorism”.
"There is still a lot to be done,” he said. “Afghanistan must not lapse back into anarchy or chaos. Afghanistan must not again become the home of global terror as was the case under the rule of the Taliban.”
Germany and the Netherlands had held joint command of 5000-strong International Security Assistance Force until the handover, which was attended by Afghan President Hamid Karzai and NATO Supreme Allied Commander Europe General James Jones.
At the ceremony, Lieutenant-General Norbert van Heyst, outgoing commander of ISAF, transferred command to another German three-star general, Goetz Gliemeroth, from NATO command.
The open-ended command is a strategic departure from NATO's Cold War role of defending its immediate borders and officials say it stems from a post-September 11 perception among its 19 members that the alliance needs to deploy where problems arise.
Pressure for wider role
Speaking after the ceremony, Jones called it "a signal moment in the history of the alliance".
"We are making a clear statement of transition, which is from the 20th Century defensive bipolar world, into the multi-polar flexible need for rapid response across a myriad of threats."
The mission comes amid US efforts to get NATO to play a part in stabilising post-war Iraq, where US troops come under almost daily attack. But it remains unclear how broad a role the alliance will take on in Afghanistan.
The US-backed Afghan regime and the United Nations have repeatedly urged ISAF's expansion into the lawless provinces, where factional rivalries and a resurgent Taliban guerrilla movement pose mounting security problems for reconstruction work and elections due to be held next year.
But the peacekeeping force's role under NATO will remain confined to the capital, at least initially.
NATO spokesman Mark Laity said on Sunday the alliance was willing to discuss expanding peacekeeping operations beyond Kabul but wanted to settle down in the job first.
Europeans worried by provincial conflict
Karzai said people in outlying provinces, where local warlords control huge swathes of territory, were calling for international peacekeepers to expand their role.
According to European diplomats, the US previously opposed any expansion of ISAF, wanting a free hand for a separate forces hunting Taliban remnants and the group's al-Qaida allies blamed for the September 11 attacks in 2001.
They say Washington appears to have had a change of heart but some European partners are worried about increased risk and cost.
While ISAF casualties in Kabul have been relatively low, risks would soar in provinces haunted by unruly militias and Taliban guerrillas blamed for killing about 100 government soldiers, policemen and officials this year.
Underlining the continued guerrilla threat, US bases in the eastern province of Paktika came under rocket and small arms fire at the weekend, an almost daily occurrence in the past year. The were no casualties.