British Prime Minister Theresa May says the UK will make a clean break from the EU and leave its single market of around 500 million people.
In her most detailed remarks since the June 23 Brexit vote, Ms May said that Britain must regain control of its laws and borders, even as she called on the bloc to negotiate a free-trade agreement that will benefit both sides.
"We do not seek membership of the single market," Ms May said.
"Instead, we seek the greatest possible access to it through a new, comprehensive, bold and ambitious free trade agreement."
Ms May hopes the offer of a mutually beneficial deal is one the EU can't refuse. She argued that a "cliff-edge for business or a threat to stability" is good for neither Europe nor Britain.
"I know there are some voices calling for a punitive deal that punishes Britain and discourages other countries from taking the same path," she said.
"That would be an act of calamitous self-harm for the countries of Europe. And it would not be the act of a friend."
Ms May promised for the first time that Britain's Parliament will be able to vote on the final divorce deal reached between the UK and EU - likely in 2019.
However, she didn't address what would happen should Parliament reject the agreement.
The British pound rallied on having some clarity at last. The currency was recovering from steep losses earlier in the week, trading 2.2 percent higher at US$1.2309. On Monday, it was as low as US$1.20, a near 31-year low.
Currency traders liked that the matter would be put to Parliament, giving Ms May a chance to tame the excesses of the more fervent Brexiteers, said Kathleen Brooks, research director of City Index.
Ms May rejected both the "hard Brexit" label and its opposite, a compromise "soft Brexit." She said she wants a new relationship based on free trade between the UK and EU.
"We want to buy your goods, sell you ours, trade with you as freely as possible, and work with one another to make sure we are all safer, more secure and more prosperous through continued friendship," Ms May said.
That includes a customs agreement, though Ms May said she has an "open mind" about whether that means staying in the EU Customs Union, which currently prevents Britain from striking trade deals with other countries.
In a bid to alleviate fears that Brexit will mean a more insular Britain, Ms May said she wants the country to be "stronger, fairer, more united and more outward-looking than ever before."
Britain is quitting the EU's single market in goods and services in order to gain control over immigration - a key issue for many voters who backed Brexit.
EU leaders say Britain can't stay in the single market without allowing free movement of people from the bloc.
Ms May was firm on the immigration question, saying it was a key reason people voted to leave.
"It remains an important priority for Britain - and for many other member states - to resolve this challenge as soon as possible," she said.
Losing single-market access alarms many in Britain's huge financial services sector, which relies on an ability to do business seamlessly across the 28-nation bloc. It also worries the many foreign firms that use London not only as a financial hub but as an entry point into the EU.
Ms May has repeatedly said she would invoke Article 50 of the EU's key treaty by March 31, to formally begin a two-year process of negotiating Britain's departure.
However she has until now refused to reveal details about the government's goals or negotiating strategy, arguing that to do so would weaken Britain's hand.