Cambodian Prime Minister Hun Sen and his Vietnamese counterpart Nguyen Tan Dung witnessed the first plantation of the border markers at the Bavet-Mocbai international border crossing.
Hun Sen said it was a historical work which would benefit the younger generation of both countries.
The installation of permanent and clear markers met the long demand of both peoples to solve the border issue and would turn a new page of history full of hope, he added.
Nguyen Tan Dung said that "we consider it a historical event as it is a victory for both peoples."
With the border clarified, both countries' economy would surely get improved, he added.
Wednesday's inauguration was arranged under the bilateral border agreement signed by both sides in 1985 and the amendments to it signed on Oct. 10, 2005.
Cambodia and Vietnam plan to install 353 border markers and the work is expected to be finished in 2008.
The border dispute between Cambodia and Vietnam can be traced back to the 19th century when France colonized the two countries and the traditional demarcation was changed. Later after 1979, the border lines were also re-drawn without common knowledge and approval of both peoples.