Since it was first detected in late April in Mexico and the United States, swine flu has reached 74 countries, infecting nearly 29,000 people. Most who catch the bug have only mild symptoms and don't need medical treatment.
WHO chief Dr. Margaret Chan made the long-awaited declaration after the U.N. agency held an emergency meeting with flu experts and said she was moving to phase 6 - the agency's highest alert level - which means a pandemic is under way.
"The world is moving into the early days of its first influenza pandemic in the 21st century," Chan said in Geneva.
Dr. Thomas Frieden, the new head of the U.S. Centers for Disease Control and Prevention, said in Atlanta that he does not expect widespread public anxiety in the United States as a result of the declaration, noting it came nearly two months after the virus was identified.
For many weeks, U.S. health officials have been treating it as a pandemic, increasing the availability of anti-viral flu medicines and pouring money into a possible vaccination program. And scientists have grown to understand that the virus is generally not much more severe than the seasonal flu.
"That helps to tamp down any fears that may be excessive," Frieden said at a news conference - his first as CDC director.
But the virus can still be deadly and may change into a more frightening form in the near future, and so people should not be complacent, he added.
So far, swine flu has caused 144 deaths, compared with ordinary flu that kills up to 500,000 people a year.
The pandemic decision might have been made much earlier if WHO had more accurate information about swine flu's rising sweep through Europe. Chan said she called the emergency meeting with flu experts after concerns were raised that some countries, such as Britain, were not accurately reporting their cases.
Chan said the experts unanimously agreed there was a wider spread of swine flu than was being reported.
She would not say which country tipped the world into the pandemic, but WHO flu chief Keiji Fukuda said the situation from Australia seemed to indicate the virus was spreading rapidly there - more than 1,300 cases were reported by Thursday.
In Chile, authorities have identified almost 1,700 cases to WHO.
Many health experts said the world has been in a pandemic for weeks but WHO became too bogged down by politics to declare one. In May, several countries urged WHO not to declare a pandemic, fearing it would cause social and economic turmoil. At the time, WHO said it would rewrite its pandemic definition to avoid announcing one.
But with the recent surge in cases across Europe, Chile, Australia and Japan, the agency was under increasing pressure to acknowledge a pandemic.
"This is WHO finally catching up with the facts," said Michael Osterholm, a flu expert at the University of Minnesota.
David Ropeik, an expert in risk perception and communication at Harvard University, says the word pandemic is less frightening than when emerged during worries about bird flu a few years ago.
He said the "soft buildup" to declaring swine flu a pandemic has been helpful.
"That allows people to get used to what is otherwise a scary word, understand the particulars of the disease, and that should mean reaction will be a little more information-based and a little less emotional," Ropeik said in an e-mail.
WHO will now recommend that pharmaceutical companies make swine flu vaccine. The agency typically recommends which flu strains drug companies should use in the vaccines. In a global outbreak, WHO also advises whether companies should make pandemic vaccine.
The decision to make pandemic vaccine is a gamble. Most flu vaccine makers cannot make both regular seasonal flu vaccine and pandemic vaccine at the same time. That means they must decide which one the world will need more.
Drug giant GlaxoSmithKline PLC said it could start commercial production of pandemic vaccine in July but that it would take months before large quantities are available.
Glaxo spokesman Stephen Rea said the company's first doses of vaccine would be reserved for countries who had ordered it in advance, including Belgium, Britain and France. He said Glaxo would also donate 50 million doses to WHO for poor countries.
Pascal Barollier, a spokesman for Sanofi-Aventis, said they were also working on a pandemic vaccine but WHO had not yet asked them to start making mass quantities of it.
WHO described the pandemic as "moderate." Fukuda said people should not get overly anxious about the virus. "Understand it, put it in context, and then you get on with things," he said.
Still, about half of the people who have died from swine flu were previously young and healthy - people who are not usually susceptible to flu. Swine flu is also crowding out regular flu viruses. Both features are typical of pandemic flu viruses.
Swine flu is also continuing to spread during the start of summer in the northern hemisphere. Normally, flu viruses disappear with warm weather, but swine flu is proving to be resilient.
"What this declaration does do is remind the world that flu viruses like H1N1 need to be taken seriously," said U.S. Secretary of Health and Human Services Kathleen Sebelius, warning that more cases could crop up in the fall.
Now that a pandemic has been declared, some countries might be prompted to devote more money to containing the virus. Many developed countries have pandemic preparedness plans that link spending to a WHO declaration.
The U.N. is keen to avoid panic. "We must guard against rash and discriminatory action, such as travel bans or trade restrictions," said U.N. Secretary-General Ban Ki-moon.
Fear has already gripped Argentina, where thousands have flooded hospitals this week, bringing emergency health services in Buenos Aires to the brink of collapse during winter weather. Last month, a bus arriving in Argentina from Chile was stoned by people who thought a passenger had swine flu.
China has quarantined travelers, including New Orleans Mayor Ray Nagin, on the slightest suspicion of contact with an infected person.
The U.S. government has already increased the availability of flu-fighting medicines and authorized $1 billion for developing a new swine flu vaccine. In addition, new cases seem to be declining in many parts of the country, U.S. health officials say, as North America moves out of its traditional winter flu season.
Still, New York City reported three more swine flu deaths Thursday, including a child under 2, a teenager and a person in their 30s.
"Countries where outbreaks appear to have peaked should prepare for a second wave of infection," Chan warned.