Closed migrant centres are to be set up in EU states to process asylum claims under a deal reached after marathon talks at a leaders summit in Brussels.
The centres, hosted on a voluntary basis, would determine who are illegal migrants "who will be returned".
Italy - the entry point for thousands of migrants, mainly from Africa - had threatened to veto the summit's entire agenda if it did not receive help.
Resettlement of genuine refugees would also take place on a voluntary basis.
There were no details on which countries would host the centres or receive refugees.
But French President Emmanuel Macron, returning to Brussels for more talks on Friday morning, said the centres would be in countries where migrants first arrive in the EU.
"We have struck the right balance between responsibility and solidarity," he said.
The numbers illegally entering the EU have dropped 96 per cent since their 2015 peak, the European Council says.
The EU leaders' joint communique also speaks of restricting the movement of asylum seekers between EU states.
"After this European summit, Europe is more responsible and offers more solidarity," said Italian Prime Minister Giuseppe Conte. "Today Italy is no longer alone."
But German Chancellor Angela Merkel said more needed to be done to resolve disagreements, reports BBC.
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