Pakistan is reopening key supply routes into Afghanistan that have been closed since November when a US air raid in Salala killed 24 Pakistani soldiers, Hillary Clinton, the US secretary of state, has said.
During a telephone conversation on Tuesday with her Pakistani counterpart, Hina Rabbani Khar, Clinton said that Washington was sorry for the deaths and that Khar had informed her the ground supply lines would be reopened.
Islamabad has long demanded that the US must apologise for November's air raid, before it would reopen the NATO routes, closed in angerafter the attack.
"Foreign Minister Khar and I acknowledged the mistakes that resulted in the loss of Pakistani military lives," Clinton said in a statement.
"We are sorry for the losses suffered by the Pakistani military. We are committed to working closely with Pakistan and Afghanistan to prevent this from ever happening again."
In a separate statement, Leon Panetta, the US secretary of defence, said the US "remains committed to improving our partnership with Pakistan and to working closely together as our two nations confront common security challenges in the region".
Earlier, Pakistan's new prime minister acknowledged that continuing the seven-month blockade was negatively affecting relations with Washington and other NATO member states.
"The continued closure of supply lines not only impinge our relationship with the US, but also on our relations with the 49 other member states of NATO," Raja Pervez Ashraf told a meeting of top civilian and military leaders.
A senior government official said the defence committee of the cabinet had met to discuss whether to end the blockade, but his office stopped short of announcing any decision after the talks ended.
Al Jazeera's Rosiland Jordan, reporting from Washington, said there had been "a lot of back and forth on the technical details of what an apology [from the US] would look like".
Jordan said the US apology, the result of a very lengthy behind the scenes process, was a "huge" step in addressing fears of US infringement on Pakistani territory.
Continued drone strikes in the nation's tribal belt and the aftermath of the US killing of Osama Bin Laden last May, were seen as the major points of contention between Islamabad and Washington.
Sherry Rehman, Pakistan's ambassador to the US, said he was hopeful ties with Washington will improve following Tuesday's apology.
"We appreciate Secretary Clinton's statement, and hope that bilateral ties can move to a better place from here. I am
confident that both countries can agree on many critical issues, especially on bringing peace to the region," Rehman said in a statement.
The Pakistani Taliban said on Tuesday that they will attack any NATO supply trucks travelling along the route.
Al Jazeera's Kamal Hyder, reporting from Peshawar, says that though the Taliban threat is a real one, the scale of the supply operation means that both NATO and Pakistani forces have had to take losses into account from the beginning.
"The losses, despite the fact that they have become a problem are nowhere near the levels that would cause alarm bells to ring" our correspondent said.
What would cause a problem, however, said Hyder is if "the Pakistani Taliban attack bridges or decide to take these people head on in the tribal areas" connecting Pakistan to the southern Afghan province of Kandahar.
The blockade has forced the alliance to rely on longer, more expensive, northern routes through Russia and Central Asia.
Initial hopes of a deal on reopening the routes had fallen apart at a NATO summit in Chicago in May amid reports that Pakistan was demanding huge fees for each of the thousands of trucks that rumble across the border every year.
But Clinton said on Tuesday: "Pakistan will continue not to charge any transit fee in the larger interest of peace and security in Afghanistan and the region.
"This is a tangible demonstration of Pakistan's support for a secure, peaceful, and prosperous Afghanistan and our shared objectives in the region."
Reopening the routes would help the US and NATO to complete its withdrawal of troops from Afghanistan "at a much lower cost," Clinton said.
"This is critically important to the men and women who are fighting terrorism and extremism in Afghanistan."
All foreign combat troops are due to leave Afghanistan at the end of 2014, 13 years after the US invasion of 2001 which toppled the Taliban.