Mexico has effectively legalised the country's growing "self-defence" groups as security forces captured one of the four top leaders of the Knights Templar drug cartel, which vigilante groups have been fighting for the last year.
The government said it had reached an agreement with vigilante leaders to incorporate the armed civilian groups into old and largely forgotten quasi-military units called the Rural Defence Corps. Vigilante groups estimate their numbers at 20,000 men under arms.
The twin announcements may help the administration of President Enrique Pena Nieto find a way out of an embarrassing situation in the western state of Michoacan, where vigilantes began rising up last February against the Knights Templar reign of terror and extortion after police and troops failed to stop the abuses.
"The self-defence forces will become institutionalised, when they are integrated into the Rural Defence Corps," the Interior Department said. Police and soldiers already largely tolerate, and in some cases even work with, the vigilantes, many of whom are armed with assault rifles that civilians are not allowed to carry.
Vigilante leaders will have to submit a list of their members to the Defence Department and the army will apparently oversee the groups, which the government said "will be temporary". They will be allowed to keep their weapons as long as they register them with the army.
The military will give the groups "all the means necessary for communications, operations and movement", according to the agreement.
The vigilante leaders, who include farmers, ranchers and some professionals, gathered to discuss the agreement, but it was not yet clear for them what it would imply. It was not known if the army would offer anyone salaries.
Misael Gonzalez, a leader of the self-defence force in the town of Coalcoman, said leaders had accepted the government proposal. But the nuts-and-bolts "are still not well defined", he added.
Vigilante leader Hipolito Mora said the agreement also allows those who qualify to join local police forces. "The majority of us want to get into the police...I never imagined myself dressed as a policeman, but the situation is driving me to put on a uniform," he said.
While the cartel may be on its way out, "there shouldn't be abuses by those who come after, there shouldn't be what we would call a witch-hunt; there should be reconciliation," said the Rev Javier Cortes, part of a team of priests in the Roman Catholic diocese of Apatzingan who have condemned abuses by the Knights Templar.
Before dawn yesterday, soldiers and police arrested one of the cartel's top leaders, Dionicio Loya Plancarte, alias "El Tio" or The Uncle.
National Public Safety System secretary Monte Rubido said the feared drug lord was arrested without a shot being fired. He said federal forces found Loya Plancarte in Morelia, the capital of Michoacan, "hiding in a closet" and accompanied only by 16-year-old boy.
Loya Plancarte, 58, had a 30-million peso (£1.3m) reward on his head from the Mexican government for drug, organised crime and money-laundering charges and was considered one of the country's three dozen most-wanted drug lords in the late 2000s.
He got his nickname because he is believed to be the uncle of another top Knights Templar leader, Enrique Plancarte Solis.
The Knights Templar ruled many parts of Michoacan with an iron fist, demanding extortion payments from businesses, farmers and workers, but the self-defence groups have gained ground against the cartel in recent months.
Federal police and army troops were sent to bring peace to the troubled region, but the vigilantes have demanded the arrest of the cartel's major leaders before they lay down their guns.
Ramon Contreras, an activist in the vigilante movement from the town of La Ruana, which was the first to rise up against the Knights Templar, said the arrest "means a lot" to the vigilantes but they would not rest until they saw all the top bosses arrested.