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By Douglas Hamilton

PRISTINA, Feb 17 (Reuters) - Kosovo Albanians will proclaim independence from Serbia on Sunday, ending a long chapter in the bloody breakup of Yugoslavia but cementing a bitter ethnic frontline in the Balkans.

Kosovo will be the 6th state carved from the Serb-dominated federation since 1991, after Slovenia, Croatia, Macedonia, Bosnia and Montenegro, and the last to escape Serbia's embrace.

The Serbs vow never to give up the land where their history goes back 1,000 years.

They will reject independence in defiance of the Albanians and their Western backers and will keep their grip on strongholds in northern Kosovo, making the ethnic partition of the new state a reality from the start.

"The influence of Belgrade has ended," Kosovo Prime Minister Hashim Thaci said. "The success of Kosovo's independence as a new beginning will be clearly measured by respect for the rights of minorities, especially Serbs," the former guerrilla promised.

Snow blanketed the capital on Sunday morning after triumphant celebrations the night before, thousands of Albanians pouring into the streets, flags in every hand and car horns blaring. Banners proclaimed "Happy Independence".

"Today, a new life begins. The past should not be forgotten, but it belongs to the past, and should be forgiven," the Kosovo daily Koha Ditore wrote.

Ten years ago this week, Serb forces fought an Albanian guerrilla uprising, killing civilians who got in the way. Major Western powers were calling for talks. Russia backed Serbia in its battle with "terrorists".

Determined to end a decade of humiliation from Belgrade under the late autocrat Slobodan Milosevic, the Albanians fought on until the West, unable to sit powerless after other Balkan bloodbaths, bombed Serbia into submission in 1999.

Kosovo has been run by the United Nations since Serb forces withdrew in June that year. Promised swift recognition by the United States and major European Union powers, Kosovo's 90 percent Albanian majority can now ignore Serb warnings.

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"This is the happiest day," said Tahir Bajrami, an elderly Kosovo Albanian who flew from New York to join the celebrations. "We were prisoners, but this marks a new beginning," he said.

The European Union will deploy a rule-of-law mission of some 2,000 starting next month to take over from the United Nations. A NATO-led peace force of 16,000 troops will stay on.

Establishing their writ in Serb-dominated land north of the Ibar River will be their toughest challenge. Serbia says the EU mission is illegitimate because it has no U.N. mandate, and its major ally Russia backs that position.

Serbia promised reprisals but kept them secret. Analysts believe any trade, diplomatic or bureaucratic blockade will be relatively short-lived. But they say impoverished Kosovo, whose population of 2 million is Europe's youngest, will need a lot of development aid and on-the-spot guidance for years to come.

Western powers are also nervously watching for any Kosovo fallout in ethnically divided Bosnia, where some Serbs threaten to secede, breaking up their uneasy partnership with Muslims and Croats in what would be yet another Balkan fragmentation.

And in neighbouring Macedonia, where NATO and the EU stepped in to cut short an ethnic guerrilla war, the Macedonian-Albanian coalition had its fingers crossed for a soft landing in Kosovo.

NATO peacekeepers were not relying on optimism. French troops prepared concrete and razor-wire barriers to separate Serbs from Albanians in the flashpoint city of Mitrovica.

The commander of NATO peacekeepers in Kosovo, French Lieutenant-General Xavier de Marnhac, said his troops "will react and oppose any provocation that may happen during these days, whether from the Albanian or the Serb side".

Tens of thousands of Serbs fled Kosovo in 1999, fearing Albanian vengeance. Of the 120,000 who stayed, about half live in the northern enclave. But the rest are scattered in small, isolated and vulnerable villages.

Kosovo's declaration will come at a session of parliament to begin at 3.00 p.m. (1400 GMT). Serbia's Prime Minister Vojislav Kostunica will address his country at 4.00 p.m. (1500 GMT).

The weather forecast was for heavy snow all day. (Additional reporting by Matt Robinson and Shaban Buza; Editing by Janet Lawrence)

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