By Tim Gaynor

PHOENIX, May 17 (Reuters) - Some U.S.-based immigrants wept in relief at news of a deal between leading senators that would grant millions of undocumented immigrants lawful status, while other reform advocates warned any celebration was premature.

The agreement reached on Thursday sets the stage for what is expected to be a passionate Senate debate over the proposal, which would create a temporary worker program, set up a merit-based system for future immigrants and give legal status to 12 million illegal immigrants.

"I have been getting calls from migrants weeping with emotion. It's unbelievable the relief that they are feeling," said Elias Bermudez, the director of the Immigrants Without Borders activist group in Phoenix.

"What this news means to the millions of people in this country illegally ... is that they can leave their homes in the morning without fear of deportation," he added.

Hundreds of thousands of mostly Hispanic immigrants took to the streets on May 1 to call for an overhaul of immigration laws and an end to deportations by U.S. authorities.

Under the plan agreed to by Senate leaders, a new Z visa would be created for illegal immigrants who can prove they arrived in the United States before Jan. 1, 2007.

It would also create a temporary worker program that would allow workers from Mexico and other countries to work for two years and then require them to go home before they could return. At least 400,000 visas a year could be issued.

Other pro-immigrant advocates urged caution on Thursday, saying the agreement faced a rocky road on Capitol Hill and contained ambiguous areas that required clarification.

"There are signs of progress, but there's a long way to go to enacting this or any other bill," said John Trasvina, president and general counsel of the Mexican American Legal Defense and Educational Fund.

"All we got today was a compromise between very important senators and the White House, it doesn't bring along everybody. There's a lot of work to be done," he added.

Trasvina said he believed the legislation should grant guest workers the same rights as the rest of the workforce. He also wanted clarification of how the points system for future migrants would work and a provision on family reunification.

"We are still trying to get a sense of what's in there. We are concerned at family reunification being cut back and the point system for future legal immigrants. We are going to look at the details very closely and see if it can be fixed," he said.

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