Greek Prime Minister George Papandreou and opposition leader Antonis Samaras have agreed a deal on a new coalition government.
The agreement came after the two leaders held talks with the Greek president in an effort to break a political deadlock and thrash out a deal for a national unity government demanded by the country's European partners.
A statement from the Greek presidency said the two sides will meet again on November 7 to discuss who would lead the coalition government, but that Papandreou would not lead the new administration.
The crisis in Athens has threatened the country's ability to avoid a catastrophic bankruptcy and retain its cherished eurozone membership.
EU Economic and Monetary Affairs Commissioner Olli Rehn has said that Greece needs to form a national unity government and push through strict austerity measures to continue membership in the eurozone.
A unity government would help secure a crucial new 130 billion euro ($179 billion) international bailout.
compiled from agency reports