Cuba's leader Fidel Castro and his brother Cuba's President Raul Castro talk during the opening session of the National Assemby in Havana, Cuba, Sunday, Feb. 24, 2012. Cuba's parliament reconvened Sunday with new membership and was expected to name Raul Castro to a new five-year-term as president. Raul Castro fueled speculation on Friday when he talked of his possible retirement and suggested he has plans to resign at some point.(AP Photo/Ismael Francisco, Cubadebate)
Cuba's leader Fidel Castro and his brother Cuba's President Raul Castro talk during the opening session of the National Assemby in Havana, Cuba, Sunday, Feb. 24, 2012. Cuba's parliament reconvened Sunday with new membership and was expected to name Raul Castro to a new five-year-term as president. Raul Castro fueled speculation on Friday when he talked of his possible retirement and suggested he has plans to resign at some point.(AP Photo/Ismael Francisco, Cubadebate)
Cuba's President Raul Castro, right, and brother Fidel Castro attend the opening session of the National Assemby in Havana, Cuba, Sunday, Feb. 24, 2012. Cuba's parliament reconvened Sunday with new membership and was expected to name Raul Castro to a new five-year-term as president. Raul Castro fueled speculation on Friday when he talked of his possible retirement and suggested he has plans to resign at some point.(AP Photo/Ismael Francisco, Cubadebate)
Cuba's leader Fidel Castro and his brother Cuba's President Raul Castro attend the opening session of the National Assemby in Havana, Cuba, Sunday, Feb. 24, 2012. Cuba's parliament reconvened Sunday with new membership and was expected to name Raul Castro to a new five-year-term as president. Raul Castro fueled speculation on Friday when he talked of his possible retirement and suggested he has plans to resign at some point.(AP Photo/Ismael Francisco, Cubadebate)
Cuba's leader Fidel Castro attends the opening session of the National Assemby in Havana, Cuba, Sunday, Feb. 24, 2012. Cuba's parliament reconvened Sunday with new membership and was expected to name Raul Castro to a new five-year-term as president. He fueled speculation on Friday when he talked of his possible retirement and suggested he has plans to resign at some point.(AP Photo/Ismael Francisco, Cubadebate)
Cuba's President Raul Castro holds up the ballot of his brother Fidel, also present in the session, for president of the National Assembly during the opening session of the parliament in Havana, Cuba, Sunday, Feb. 24, 2012. Cuba's parliament reconvened Sunday with new membership and was expected to name Raul Castro to a new five-year-term as president. He fueled speculation on Friday when he talked of his possible retirement and suggested he has plans to resign at some point.(AP Photo/Ismael Francisco, Cubadebate)
HAVANA (AP) ? Raul Castro announced Sunday that he will step down as Cuba's president in 2018 following a final five-year term, for the first time putting a date on the end of the Castro era. He tapped rising star Miguel Diaz-Canel as his top lieutenant and first in the line of succession.
The 81-year-old Castro also said he hopes to establish two-term limits and age caps for political offices including the presidency ? an astonishing prospect for a nation led by Castro or his older brother Fidel since their 1959 revolution.
The 52-year-old Diaz-Canel is now a heartbeat from the presidency and has risen higher than any other Cuban official who didn't directly participate in the heady days of the revolution.
"This will be my last term," Castro said, his voice firm.
In his 35-minute speech, Castro hinted at other changes to the constitution, some so dramatic that they will have to be ratified by the Cuban people in a referendum. Still, he scotched any idea that the country would soon abandon socialism, saying he had not assumed the presidency in order to destroy Cuba's system.
"I was not chosen to be president to restore capitalism to Cuba," he said. "I was elected to defend, maintain and continue to perfect socialism, not destroy it."
Castro fueled interest in Sunday's legislative gathering after mentioning on Friday his possible retirement and suggesting lightheartedly that he had plans to resign at some point.
It's now clear that he was serious when he promised that Sunday's speech would have fireworks, and would touch on his future in leadership.
Cuba is at a moment of "historic transcendence," Castro told lawmakers in speaking of his decision to name Diaz-Canel to the No. 2 job, replacing the 81-year-old Jose Ramon Machado Ventura, who fought with the Castros in the Sierra Maestra.
Castro praised Machado Ventura and another aging revolutionary for offering to leave their positions so that younger leaders could move up.
Their selflessness is "a concrete demonstration of their genuine revolutionary fiber ... That is the essence of the founding generation of this revolution."
Castro said that Diaz-Canel's promotion "represents a definitive step in the configuration of the future leadership of the nation through the gradual and orderly transfer of key roles to new generations."
"Our greatest satisfaction is the tranquility and serene confidence we feel as we deliver to the new generations the responsibility to continue building socialism," he added.
On the streets of Havana, where people often express a jaded skepticism of all things political, there was genuine excitement.
"This is the start of a new era," said Roberto Delgado, a 68-year-old retiree walking down a street in the leafy Miramar neighborhood. "It will undoubtedly be a complicated and difficult process, but something important happened today."
"I'm mesmerized," added Regla Blanco, 48. "You thought that with all these old men, it would never end. I am very satisfied with what Raul said. He is keeping his promise."
Since taking over from Fidel in 2006, Castro has instituted a slate of important economic and social changes, expanding private enterprise, legalizing a real estate market and relaxing hated travel restrictions.
Still, the country remains ruled by the Communist Party and any opposition to it lacks legal recognition.
Castro has mentioned term limits before, but he has never said specifically when he would step down, and the concept has yet to be codified into Cuban law.
If he keeps his word, Castro will leave office no later than 2018. Cuban-American exiles in the United States have waited decades for the end of the Castro era, although they will likely be dismayed if it ends on the brothers' terms.
Nevertheless, the promise of a change at the top could have deep significance for U.S.-Cuba ties. The wording of Washington's 51-year economic embargo on the island specifies that it cannot be lifted while a Castro is in charge.
When Raul Castro hinted at his retirement plans on Friday, it earned a sharp response from Rep. Ileana Ros-Lehtinen, a Cuban-American Republican from Florida, who called it a ploy.
"If dictator Raul Castro states that he will retire in five years, there will still be no real change for the Cuban people so long as the Castro brothers remain in any form of leadership position, even behind the scenes," she said. "The U.S. should not change its policy of isolation of the Cuban regime."
Fidel Castro is 86 and retired, and has appeared increasingly frail in recent months. He made a surprise appearance at Sunday's gathering, receiving a thunderous ovation from lawmakers.
Some analysts have speculated that the Castros would push a younger member of their family into a top job, but there was no hint of that Sunday.
While few things are ever clear in Cuba's hermetically sealed news environment, rumblings that Diaz-Canel, an electrical engineer by training and ex-minister of higher education, might be in line for a senior post have grown.
In recent weeks, he has frequently been featured on state television news broadcasts in an apparent attempt to raise his profile.
He also traveled to Venezuela in January for the symbolic inauguration of Hugo Chavez, a key Cuban ally who had been re-elected president but was too ill to be sworn in.
The 612 lawmakers sworn in Sunday also named Esteban Lazo as the National Assembly's first new chief in 20 years, replacing Ricardo Alarcon.
Lazo, who turns 69 on Tuesday, is a vice president and member of the Communist Party's ruling political bureau. Parliament meets only twice a year and generally passes legislation unanimously without visible debate.
The legislature also named as vice presidents of the ruling Council Machado Ventura; comptroller general Gladys Bejerano; second Vice President Ramiro Valdes; Havana Communist Party secretary Lazara Mercedes Lopez Acea; and Salvador Valdes Mesa, head of Cuba's labor union.
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Anne Marie-Garcia and Paul Haven contributed to this report.
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Peter Orsi on Twitter: www.twitter.com/Peter_Orsi
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