Ignoring Turkish protests, the French lower house of parliament approved a bill on Thursday making it a crime to deny that Armenians suffered genocide in 1915 at the hands of the Ottoman Turks.
French businesses fear a Turkish backlash because of the legislation, which has highlighted broader anxieties about Turkish efforts to secure European Union membership.
The bill still needs to be ratified by both the upper house Senate and the French president to become law, but Turkey has already warned that Thursday's vote would damage ties between the two Nato allies.
Turkey denies accusations of a genocide of some 1.5 million Armenians during the disintegration of the Ottoman Empire in World War One, arguing that Armenian deaths were a part of general partisan fighting in which both sides suffered.
However, France's Armenian community, which is up to 500,000-strong and one of the largest in Europe, had pushed hard for the bill and found cross-party support within parliament.
The motion was carried by 106 votes to 19.
The legislation establishes a one-year prison term and 45,000 euro fine for anyone denying that a genocide occurred - exactly the same sanctions as those imposed for denying the Nazi genocide of Jews during World War Two.
The French government did not support the motion, saying it was up to historians and not parliament to judge the past, but the ruling Union for a Popular Movement (UMP) gave its lawmakers a free hand in the vote, ensuring it would pass.
"Imagine for a second that Germany today denied the Holocaust. It is totally unacceptable," UMP politician Patrick Devedjian, who is of Armenian origin, told RTL radio.
