The world's largest chip maker has teamed up with the world's largest mobile phone maker to create what they say will be a "new exciting industry".
Intel and Nokia said their "technology collaboration" would deliver new mobile computing products - beyond existing smartphones, netbooks and notebooks.
But both companies added it was still too early to talk about product plans.
The deal gives Intel its first real breakthrough in the multi-billion dollar mobile-phone market.
"This collaboration will drive exciting new revenue opportunities for both companies and shape the next era of mobile computing," said Anand Chandrasekher, Intel's senior vice president of its ultra-mobility group.
Nokia's executive vice president for devices, Kai Oistamo said: "It will be compelling not only for our companies, but also for our industries, our partners and, of course, for customers."
"Brave new world"
Both companies said the partnership would centre around several open-source mobile Linux software projects, including the Moblin platform for Atom-based processors and the Maemo operating system developed by Nokia.
Intel will also acquire a licence from Nokia that is used in modem chips to connect to third generation cellular networks.
Intel's chips power most of the world's personal computers
Although Intel makes chips for Wi-Fi and WiMax networks, it has previously lacked the technology to provide a complete technology package for portable device makers.
In a conference call with reporters, neither company would not be drawn on what any future products would look like.
"We will talk about products when we are ready to talk about products," said Mr Chandraseckher
"With the convergence of the internet and mobility as the team's only barrier, I can only imagine the innovation that will come out of our unique relationship with Nokia. The possibilities are endless."
ABI Research says that last year a total of 1.2 billion mobile phones were sold globally.
Mr Oistamo was equally tight-lipped on the subject of future products, but he added: "We will explore new ideas in designs, materials and displays that will go far beyond devices and services on the market today.
"The future is truly exciting and there is a lot of room here to redefine what mobile is and what it can do as we create this brave new world."
"Wave of the future"
Intel's microprocessors are found in eight out of 10 personal computers, while Nokia boasts around a billion customers but is not as big a player in the US as it is in Europe.
The alliance could spell stiffer competition for ARM Holdings, which is one of the biggest suppliers of chips in the cell phone marketplace.
The deal will boost Nokia's presence in the United States
Analysts welcomed the collaboration, which they described as significant for both companies.
"Intel has really been trying to get a foothold in the wireless world in the worst way," Will Strauss, principal analyst with Forward Concepts told the BBC.
"They know portability, mobility is the wave of the future. Nokia is the world's biggest cell-phone maker in the world so getting a piece of Nokia's business is a big deal.
From : BBC