Mr Saleh signed the agreement, brokered by Yemen's Gulf Arab neighbours, in the Saudi capital, Riyadh.

Under the plan, the president will hand over power to deputy Abdrabuh Mansur Hadi in return for immunity from prosecution.

Mr Hadi is then expected to form a national unity government and also call for early presidential elections within 90 days.

The deal envisages that Mr Saleh will remain an honorary president for three months after signing the agreement.

In Riyadh, Mr Saleh pledged to co-operate with the new government which would include the opposition.

He also called on all Yemenis to be partners in rebuilding the conflict-torn country.

The breakthrough comes after intensive talks in Yemen by the UN envoy to the country, Jamal Benomar.

But protesters rallying in the Yemeni capital, Sanaa, said they would reject any deal giving the president immunity.

Clashes broke out between pro-Saleh troops and gunmen loyal to dissident chief Sheikh Sadiq al-Ahmar in Sanaa on November 23.

No casualties were immediately reported in the fighting in Sanaa's al-Hasaba district.