David Cameron insisted last night he had fulfilled his promise to pull the Tories out of the main centre-right group in the European Parliament - despite delaying the move until 2009.
The Tory leader announced a new alliance between Conservative MEPs and those of the Czech Civic Democratic Party.
But he said that the new grouping would not be created until 2009, at the request of the Tories' new partners.
Mr Cameron faced immediate criticism from both Labour and members of his own party about the timing of the move and concerns about arrangements until 2009.
But he said that the decision was the most "sustainable" option available and met the pledge he made during his leadership campaign.
Speaking at a joint press conference with the leader of the Civic Democrats, Czech Prime Minister designate Mirek Topolanek, Mr Cameron said: "The deal has been delivered."
He added: "We are here seven months into my leadership of the Conservative Party with a deal that's sustainable for the long term. That's what is key."
As one Tory MP encouraged MEPs to quit the EPP alliance now, Mr Cameron warned those that did would not be allowed to stand on a Conservative ticket in 2009.
He also denied that the Tories had struggled to find partners for a new grouping, insisting he was "fully confident" there would be other parties wanting to join by 2009. Amid criticism that the Tories would be isolated in Brussels, he added: "There are m any other potential partners."
Mr Cameron and Mr Topolanek also agreed to immediately set up a new Movement for European Reform, which would engage with political parties from countries aspiring to EU membership.
The Tory leader said that neither party could continue within the EPP for the long-term.
"While we agree about open markets and deregulation, we don't share their views about the future development of Europe," Mr Cameron said.
The new alliance would be less centralised and more outward-looking and "a strong new voice for change, optimism and hope".
He added: "It's because we want to see a future for the EU and believe in a strong Europe that we want to make the EU confront its failings."
Mr Topolanek told reporters he had requested the delay until 2009 because of negotiations over the formation of a new coalition in the Czech Republic.
But Eurosceptic Conservative MP Douglas Carswell said: "I would much rather have seen the decision come into effect straight away."
Mr Carswell added that he would support any Tory MEPs who quit the EPP.
"If there were any who would do such a move, I think it would be welcomed throughout the country," he said.