Greece has avoided a nightmare scenario by agreeing to a 130bn euros (£110bn; $170bn) bailout deal, Finance Minister Evangelos Venizelos has said.
He said the deal was probably the most important in Greece's post-war history.
The cabinet was meeting to discuss how to pass the reforms stipulated by international lenders, which include huge spending cuts and beefed-up monitoring by eurozone officials.
Trade unions have called strikes and protests for Wednesday.
Greece has already been through a massive austerity programme in return for an earlier bailout, and many are angry at the prospect of years more hardship.
Opinion polls suggest that the two parties in the coalition, which currently dominate parliament, are facing huge losses at the next election, scheduled for April.
Parties on the far left and far right, which are set to make big gains, are opposed to the bailout deal.
Under the agreement hammered out in Brussels
Greece will undertake to reduce its debt from 160% of GDP to 120.5% by 2020
private holders of Greek debt will take losses of 53.5% on the value of their bonds, with the real loss as much as 70%
eurozone experts will permanently monitor Greece's economic management
a constitutional change will give priority to debt repayments over the funding of government services
The country has just over a week to approve a round of spending cuts of more than 3bn euros tied to the bailout.
Mr Venizelos said the deal had given Greece a new opportunity, and had "avoided the nightmare scenario".
"What we have is the clear, explicit commitment of our peers that they will support us even after the end of the programme, until Greece returns to the markets," he said.
"The Brussels agreement this morning is the result of great, painful and complicated negotiations... that are perhaps the most important of the post-war era, given the economic volume and impact on politics and society."
Tuesday's cabinet meeting is expected to formalise the austerity measures and spending cuts, which then have to be approved by MPs.
But conservative leader Antonis Samaras, a member of the coalition and contender to become the next prime minister, warned that the rescue package's targets could only be met with economic growth.
"Without the rebound and growth of the economy... not even the immediate fiscal targets can be met, nor can the debt become sustainable in the long-term," he said.
Trade unions have called for new street protests on Wednesday and the head of the opposition Communist party has vowed to oppose new cuts.
"We insist on daily struggle to thwart the measures and this struggle cannot be a defensive one," said Aleka Papariga.
The prospect of permanent eurozone monitoring is also seen by many Greeks as a blow to national pride, and many question whether the austerity will actually improve the economy.
"The measures are just going to make us sink further into recession. We'll be worse off this year than last," Agelos Sotirchos told the BBC as he walked through Athens' main meat market.
Another shopper, Vasilis Bouzianis, said the bailout appeared to be the only option for Greece.
"There are a lot of difficulties for all the people; we lose more money, we pay more taxes, but if we went ahead with bankruptcy, the problem would be much bigger," he said.
The agreement was thrashed out over 13 hours of talks involving the international "troika" of the IMF, the European Central Bank and the European Commission.
Eurozone leaders hailed the deal as a triumph, and said it had saved Greece from going bankrupt.
From BBC news