U.S. President Barack Obama and Cuban leader Raul Castro shook hands for the first time since the two sides announced in December the re-establishment of diplomatic relations.
The two leaders are participating in the Seventh Summit of the Americas in Panama. This is the first meeting since the inaugural Summit that has included Cuba, as the island nation used to be excluded due to US opposition.
On the streets of Havana, Cubans welcomed the symbolically charged gesture between Castro and Obama.
"I think that it is the best thing that could have happened for them to restore relations between the two of them; that's what I think, that it should have happened earlier."
"It would be almost perfect, to strengthen those ties. For so many years, we've had that embargo that has stopped us on everything."
The two leaders spoke by phone on Wednesday before Obama left Washington.
Before that, the United States and Cuba held three rounds of talks on the process of restoring diplomatic relations and the re-opening of embassies.
US Secretary of State John Kerry and Cuban Foreign Minister Bruno Rodriguez held a closed-meeting Thursday night in Panama City, which was the highest-level meeting between the two sides since 1961.
