As part of the agreement, the new autonomous region in Mindanao will be called Bangsamoro and Muslims would have wide authority.
Celebrating the agreement by decorating their streets with green flags, representing peace, the people of Mindanao consider the agreement as the first step in the process for peace.
The Muslims of Mindanao hope that the agreement reached would give them new economic, social and political rights by 2016.
The Philippine government and the Moro Islamic Liberation Front on Monday signed a historic peace pact to end nearly four decades of their conflict that claimed tens of thousands of lives.
The preliminary framework deal -- reached after 15 years of negotiations brokered by Malaysia -- constitutes a roadmap to a final settlement which would allow for an autonomous region administered by minority Muslims in the south of this predominantly Catholic country.
The agreement was signed in a ceremony in Manila's Malacanang Presidential Palace with the participation of President Benigno Aquino III and Liberation Front leader AL Haj Murad Ebrahim. Also present at the ceremony were Malaysian Prime Minister Najib Razak, secretary general of the Organization of the Islamic Cooperation Ekmeleddin Ihsanoglu as well as heads of foreign diplomatic missions including Turkish Ambassadress to Philippines Hatice Pinar Isik.
Nearly 120 thousand have been killed and two million people have been forced to leave their homes in the 40-year-old conflict.
Reporting by Murat Demirci
