South African President Thabo Mbeki, the mediator in the talks, announced on Thursday that opposition chief Morgan Tsvangirai and President Robert Mugabe had reached the deal to end a bitter political crisis.
"Today the people of Zimbabwe breathe a little bit easier. The news of the power-sharing agreement that has just been concluded ends a long spell of fear, suffering and uncertainty," Odinga said in a statement.
"I hope this agreement will lead to a durable peace and an improvement in the people’s living standards and human rights."
"Our continent and the world are looking forward to an expeditious implementation of the peace agreement so that Zimbabweans can achieve their great dreams of democracy, peace and justice," said Odinga, one of Africa’s most vocal critics of Mugabe.
Odinga, who spoke with Tsvangirai on Wednesday, said the MDC chief told him "that he had from the beginning recognised that he would need to make sacrifices in the interest of peace."
Details of the deal are to be released on Monday, when a formal signing ceremony will be held.
South African newspapers said it provided for a 50-50 unity government between the 84-year-old Mugabe and Tsvangirai following March polls in which the ruling party was routed for the first time since independence from Britain in 1980.
Odinga himself had a political feud with Kenyan President Kwai Kibaki, whom he accused of rigging his way to re-election in December 2007.
The ensuing deadly political crisis ended when a power-sharing agreement was reached that saw Odinga take a newly-created prime minister position and Kibaki keep his job.