The New Zealand parliament passed the bill recognising the Whanganui River, in North Island, as a living entity.
Long revered by New Zealand's Maori people, the river's interests will now be represented by two people.
The Maori had been fighting for over 160 years to get this recognition for their river, a minister said.
"I know the initial inclination of some people will say it's pretty strange to give a natural resource a legal personality," said New Zealand's Treaty Negotiations Minister Chris Finlayson. "But it's no stranger than family trusts, or companies or incorporated societies."
The Whanganui River, New Zealand's third-longest, will be represented by one member from the Maori tribes, known as iwi, and one from the Crown.
The recognition allows it to be represented in court proceedings.
Tears and music
"The river as a whole is absolutely important to the people who are from the river and live on the river," said MP Adrian Rurawhe, who represents the Maori.
"From a Whanganui viewpoint the wellbeing of the river is directly linked to the wellbeing of the people and so it is really important that's recognised as its own identity."
Members of the Maori community celebrated the news with tears and music in New Zealand's parliament.
The settlement brought to an end the country's longest-running litigation, the NZHerald reports. (external - login to view)
(external - login to view)
It also included $80m (£65m) in financial redress and $30m (£25m) to a fund to improve the river's health.
New Zealand river first in the world to be given legal human status - BBC News (external - login to view)
If corporations are people, why not a river?