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By Paul Hoskins and Jonathan Saul

DUBLIN, June 13 (Reuters) - Ireland's Green Party voted overwhelmingly on Wednesday to back a coalition deal that puts it in government for the first time and guarantees a third term for Prime Minister Bertie Ahern.

"This, my friends, is the proudest day of my life," Trevor Sargent, who will step down as party leader after brokering the deal, told fellow Greens.

They voted by 441 votes to 67 in favour of joining a government dominated by Ahern's centrist Fianna Fail party that is due to be voted into office by parliament and formally appointed by President Mary McAleese on Thursday.

"It is a day when courage won out over caution. It is a day when huge change won out over the status quo," said Sargent.

Fianna Fail emerged largely unscathed from May 24 national elections with 78 legislators in the 166-seat Dail (lower house of parliament) but needed new allies after its pro-business Progressive Democrat coalition partners suffered big losses.

Backing from six Greens will give Ahern a slim majority but he is likely to bolster support to 90 with the two remaining Progressive Democrats and by bringing in four independents.

That will also dilute the influence of any one partner and ensure that while the new government will have a greener flavour, Fianna Fail's long-standing dominance as Ireland's biggest political party will likely be little impaired.

The Greens had been tipped to join the main opposition Fine Gael party and left-leaning Labour after the election in a "rainbow coalition" designed to end Ahern's decade in power.

In the event the three parties did not win enough seats between them to form a majority and the Greens opted to talk to Ahern in the hope of getting some of their policies implemented.

OLD PLEDGE

Having repeatedly criticised Ahern over his environmental and social record during last month's campaign, Sargent said on Wednesday he would honour an old pledge to step down as party leader if his party ended up in government with Fianna Fail.

Although the Greens had to shelve some key policies in order get their first taste of power, including opposition to the use of Irish airports by U.S. troops bound for Iraq, Ahern has agreed to adopt some of their environmental priorities.

A draft of the programme for government agreed between the two sides, seen by Reuters, showed commitments to cut greenhouse emissions by 3 percent a year, phase in a carbon levy, improve building standards and promote renewable energy.

"We have a better chance of doing what we have set out to achieve in government rather than remaining on the opposition benches for another five years," said pensioner Neil Hurley after voting in favour of the coalition deal.

But some felt betrayed by the decision to share power with a party the Greens so vehemently opposed in the election.

"They have sold out for a Mercedes with a nice leather interior," said 41-year-old John O'Driscoll, who works for one of the multinationals drawn to Ireland by its thriving economy.

"They have sold us down the river," he said. "Everything they campaigned for in the election was rejected tonight."

Ahern has yet to say which ministries he will hand over to the Greens in return for their support but party officials said they wanted those responsible for the environment and transport.

Finance Minister Brian Cowen is set to keep his job after consolidating his standing in the election as the most likely successor to Ahern, who has said this will be his last term.

For details of the policies agreed between the Green Party and Fianna Fail, please double click on [ID:nL13472008]

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