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Wales will become the first country in the UK where people will be presumed to have consented for their organs to be donated unless they opt out.
The current system, which operates across the UK, relies on people signing up to a voluntary scheme and carrying a donor card.
But ministers in Cardiff Bay say the new scheme will save countless lives.
A Bill for Wales to adopt a system of presumed consent passed its final stage in the Welsh Assembly - despite objections from religious groups on moral grounds as well as concerns about it adding greater distress to bereaved family members.
Assembly Members (AMs) voted in favour of the Bill by 43 votes to eight, with two abstentions.
Ministers insist the scheme will be implemented sensitively - saying they will launch a major publicity drive so people are fully informed about which choice to make.
The Bill was not likely to have been defeated as the 30-strong Labour group in the Assembly was whipped to vote in favour. Conservative and Plaid Cymru AMs were given a free vote, and the Lib Dems said all five of their AMs backed the opt-out system.
The new law is set to come into force in 2015 - after the Welsh Government has launched a two-year £8 million public campaign - and has been described as a historic event by the British Medical Association (BMA).
The BMA's secretary in Wales Dr Richard Lewis said: "This is the most important piece of legislation created in Wales since the laws of Hywel Dda.
"A few years ago, Wales was ready to lead the UK on banning smoking in public places, but we didn't have the necessary legal powers.
"This time we are delighted that our National Assembly has shown the rest of the UK the way forward and fully support its implementation.
"Patients across the country will now benefit directly or indirectly from this Bill.''
The Welsh Government has long said there is a desperate need to drive up transplantation rates - with 226 people in Wales waiting for a transplant - and hope it would increase donors by around a quarter.
The new consent law would mean that people would have to choose not to donate their organs and would apply to over-18s who die in Wales if they have lived in the country for more than 12 months.
Organs made available under the system would be the same as the "opt-in'' method - including kidneys, heart, liver, lungs and pancreas - and would not only go to donor patients in Wales. They could go anywhere in the UK.
Despite five years in the making, the issue was still hotly contested for five hours in the Senedd - with AMs from the Assembly's four parties mulling over more than 70 amendments.
Health Minister Mark Drakeford said regulations would need to be drawn up on which organs would not feature - but confirmed that tissues definitely exempt would be limbs as well as face transplants.
Roy J Thomas, chief executive of Kidney Wales Foundation, said "Deemed consent has a positive and sizeable effect on organ donation rates of some 25% to 35% higher on average in presumed consent countries.
"One person dies every week in Wales waiting for an organ transplant. Three people die a day in the UK.
"The current system has failed those waiting.
"The new deemed consent system in Wales needs to be given stewardship and trusted to the medical profession. The Human Tissue Act is there to oversee matters with a new Code of Practice for doctors.''
Mr Thomas added that religious groups had struggled initially with the moral issue organ donation presented. "The first human organ transplant occurred on June 17, 1950, at the Little Company of Mary Hospital in Evergreen Park, Illinois,'' he said.
"At the time, the church was opposed to the idea that tissue could be taken from a dead person and put into a living person, and that the tissue would then come to life again.
"But Christian churches all over the world support the system that we propose to implement here in Wales. Spain, France, Austria, Netherlands and Belgium.''
Simon Gillespie, chief executive at the British Heart Foundation, said: "This is a special and historic moment for a part of the UK that has decided to stand up and make a life-saving change.
"The Welsh have become the standard bearers and now other UK governments must join them and introduce opt-out legislation of their own.
"The system, where everyone is considered a donor unless they say otherwise, will help increase the number of available organs and better reflect the wishes of the majority of the UK.''
Celebrity doctor and Embarrassing Bodies TV presenter Christian Jesser tweeted: "Having an opt out system for organ donation has not removed any rights from you. You can still opt out. That's the point!''
However those views were not shared by campaign group Patient Concern.
Spokeswoman Joyce Robbins said: "This legislation will result in human bodies being treated like clapped-out cars. You strip them of parts for re-use, unless the owner prefers to scrap the whole vehicle.
"It's outrageous to pretend that people feel no differently about a human heart from a used car horn.
"To tell people that the absence of a registered objection equals consent is outrageous. It's a lie.
"The risks of turning off support for transplantation far outweigh the possibility of increased organ supply.''
The Christian Medical Fellowship branded the presumed consent model "unethical''. Chief executive Dr Peter Saunders said: "Organ donation should be encouraged. It resonates strongly with the Christian principles of sacrificial generosity and love for one's neighbour.
"It should be encouraged as a gift, but this system lays the framework for the taking of organs as a right. That is a very dangerous precedent indeed.''
Mr Saunders said he feared that England and Scotland would now follow suit following Wales's precedent.
But what does this actually mean?
What is the current system?
People wanting to donate their organs after their death must sign the NHS Organ Donor Register - or their families agree to their loved ones' organs being donated.
So what is being proposed in Wales?
Ministers want to change the system to one where people opt out rather than opt in. They say it will drive up transplant rates. Currently, 266 people are awaiting transplants in Wales. The change will create two forms of consent in law - "deemed consent'' of those people who have not registered to opt out of donating an organ, and "express consent'' by those who have registered to say they wish to be a donor.
How will they know who wants what?
A single register will be created and record whether or not someone wants to be an organ donor. Donors will also have the option to to donate certain organs but not others.
To whom will the new law apply?
Everyone over 18 who has lived in Wales for the past 12 months.
Is there anyone to whom this does not apply?
Yes, students not from Wales will not be affected by the law as well as Welsh people who die in another part of the UK. Also exempt are individuals lacking the mental capacity to make a decision on the matter.
How many people could stand to benefit?
Ministers hope to drive up transplant rates by a quarter. Based on current figures, this would see around 15 additional donors and 45 extra organs donated every year.
What organs are up for grabs, so to speak?
The same as with the current system. This include kidneys, heart, liver, lungs, pancreas and the small bowel.
Where will any organs end up?
Any organs donated in the system will not just stay in Wales. Like the current set-up, they can go anywhere in the UK.
What about families' wishes?
Health Minister Mark Drakeford has promised to give families a "clear right of objection''. And he has also said any organs will not be taken unless a family member is present.
But what about if a family does not know what their loved one wanted?
In this case, the default position is the deceased was in favour of donation and, as a matter of law, the deceased's consent is deemed. Relatives will be told that the deceased had not opted out, and had made no further wishes known".
So, in that situation an organ will definitely be donated?
In theory, no. Although the family has no legal veto, the last decision will ultimately rest on clinicians - who have a duty not to add distress to families of someone who has died. Even if it passes that stage, clinicians have a range of other factors to take into account.
Well, as well as establishing a match with any potential recipient, doctors also have to assess the deceased's medical history as well as the condition of the organs being considered.
Who is in favour?
Aside from ministers, several charities including Kidney Wales Foundation have lauded the scheme. Also past donors have spoken about the tense wait they endeared while waiting for a donor.
And who is against?
Opposition has come from Christian churches as well as within Muslim and Jewish communities. Critics claim it will cause extra distress for bereaved families, and could put medical staff in a difficult position. Opponents want families to be able to stop a donation if their relative did not express an opinion either way.
When is the new system due to start?
Once given Royal Assent, the law will come into effect from 2015. Ministers need to launch a two year publicity campaign to alert people of the changes - costing around £8 million.