THE QUEEN marked Armistice Day by unveiling a memorial on Hyde Park Corner, London, to Australians who died fighting alongside the British.

Crowds gathered to watch yesterday’s ceremony, which was attended by Tony Blair, the Prime Minister, and his Australian counterpart, John Howard.

The memorial honours the 102,000 Australians who died in the two world wars, and the one million who fought.

A two-minute silence was observed at the ceremony at 11am to honour all those who lost their lives.

The silence, on the 11th day of the 11th month, marks the moment when the guns fell silent at the end of the First World War in 1918.

Streets and shops around the country were silent as people paid their respects. Thousands of British armed forces personnel around the world, mindful of their losses in the past year, also paused in their duties to honour those who died in combat.

In Edinburgh, MSPs broke off from debate on the Mound and paused for two minutes, as did MPs in Westminster. Crowds gathered off Princes Street, beneath the Scott Monument, after a cannon on Edinburgh Castle battlements heralded the start of the silence.

In Glasgow, hundreds gathered at a service in Central Station. There were similar scenes in the Highland capital, Inverness.

The two minutes of silent dedication in London ended with an RAF fly-past. A service then took place, with short addresses from Mr Howard and the Queen, before the memorial was unveiled.

The war memorial is planned to become the site for the annual Anzac Day service in London.

Designed by the Australian architects Tonkin Zulaikha Greer, it features a long curving wall of Australian granite and is set with the names of the 24,000 home towns of the men and women who fought. Superimposed over these are 47 battle sites, representing theatres of war where Australians served.

Mr Howard said the memorial symbolised Australia’s and Britain’s common history in standing together in the name of freedom. He said: "Whatever the future may hold for our two nations, we are tied for all time by our history, by shared language and law - but most important of all, by an enduring belief in human dignity and the democratic freedoms that should be the birth-right of all."

The Queen said the monument would stand as a permanent tribute to Australia’s sacrifice in a common cause.

"We will be eternally grateful at how, in our darkest hour, Australia stood by our side," she said. Relative to its population, Australia suffered more losses than any other nation in the First World War.

Other dignitaries attending the ceremony included Baroness Thatcher, the former prime minister, and Geoff Hoon, the Defence Secretary.