A flag-raising ceremony was held outside the Palestinian mission in London on Monday, a day after the UK announced it would recognize the State of Palestine, along with Australia, Canada and Portugal.
Other countries, including France, are due to follow suit in recognizing Palestinian statehood at the annual UN General Assembly that opens Monday in New York.
Head of Mission Husam Zomlot hailed the "long overdue" recognition as the flag was raised in front of a crowd outside the building in Hammersmith in west London.
Holding up a plaque reading "Embassy of the State of Palestine", Zomlot said it would be put up soon, "pending some legal work, some bureaucratic work".
He called the recognition move an "acknowledgement of a historic injustice" at a time of "unimaginable suffering" for the Palestinian people in the war in Gaza.
He said the UK's recognition had particular resonance as Britain was pivotal in laying the groundwork for the creation of the State of Israel in 1948, through the 1917 Balfour Declaration.
Foreign Secretary Yvette Cooper said the Palestinian Authority could now "set up an embassy and an ambassador in the UK".
"We will set out the diplomatic steps with the Palestinian Authority, there will be a series of different stages and processes to go through," Cooper told the BBC.
"On that practical side the most important thing is that it's part of that process to keep everyone working towards a two-state solution," she added.
Questioned on when the British consulate in east Jerusalem would become an embassy, Cooper said it had been there for longer than the Israeli state, "so it will continue for now, and we will set out the diplomatic process with the Palestinian Authority".
Following Sunday's announcement, Britain's foreign ministry updated its travel advice page to remove the reference to "Occupied Palestinian territories", replacing it with "Palestine".
Israeli Prime Minister Benjamin Netanyahu has denounced the push for recognition as "absurd", saying it would "endanger" Israel's existence.
He has also vowed to accelerate the creation of new settlements in the Israeli-occupied West Bank.
The war in Gaza follows Hamas's attack on southern Israel on October 7, 2023 that resulted in the deaths of 1,219 people, most of them civilians, according to an AFP tally of official figures.
Israel's retaliatory campaign has killed at least 65,208 people, also mostly civilians, according to figures from the health ministry in Hamas-run Gaza, which the UN considers reliable.
