Bahrain has ordered its military off the square in the capital that was the heart of an uprising against the Gulf nation's rulers, a key demand by the opposition for starting a dialogue in the political crisis.
Although it was not clear how protest leaders would respond to the move, some jubilant Bahrainis honked car horns, waved flags and flashed victory signs as the armoured vehicles began moving away from Pearl Square.
An Associated Press photographer saw a contingent of riot police fire tear gas at people celebrating the army withdrawal from the square and detain at least 10 people.
It was not immediately clear if the tanks and other armoured vehicles were going back to military bases, or just pulling back from the square.
According to a government statement, the withdrawal order came from Crown Prince Salman bin Hamad Al Khalifa, deputy supreme commander of the armed forces and the member of the royal family who has been designated to open a dialogue with protest leaders.
The statement said he had ordered "the withdrawal of all military from the streets of Bahrain with immediate effect".
"The Bahrain police force will continue to oversee law and order," the statement said.
Thousands of marchers came under fire yesterday as they tried to head toward the square. More than 50 were injured in the second consecutive day of clashes.
Protesters took over Pearl Square earlier in the week, but they were driven out in a deadly assault on Thursday. They had said they were determined to take back the square today.
US President Barack Obama discussed the situation with King Hamad bin Isa Al Khalifa, asking him to hold those responsible for the violence accountable. He said in a statement that Bahrain must respect the "universal rights" of its people and embrace "meaningful reform".
Protesters who tried to march to the square yesterday described a chaotic scene of tear gas clouds, bullets coming from many directions and people slipping in pools of blood as they sought cover. Some claimed the gunfire came from either helicopters or sniper nests.
The clash came hours after funeral mourners and worshippers at Friday prayers called for the toppling of the Western-allied monarchy in the tiny island nation that is home to the US Navy's 5th Fleet, the centrepiece of the Pentagon's efforts to confront Iranian military influence.
Some members of Bahrain's Sunni ruling system worry that Shiite power Iran could use Bahrain's majority Shiites as a further foothold in the region.
The cries against the king and his inner circle - at a main Shiite mosque and at burials for those killed when security forces attacked a protest camp in Pearl Square - reflect a sharp escalation of the political uprising, which began with calls to weaken the Sunni monarchy's power and address claims of discrimination against the Shiite majority.
The mood, however, has turned towards defiance of the entire ruling system after the crackdown, which put the nation under emergency-style measures, with military forces in key areas and checkpoints on main roads.