After 12 hours of often chaotic debate in the Barcelona parliament, a majority voted for the referendum and the legal framework to set up a new state, under which the assembly would declare independence within 48 hours of a "yes" vote.
The tense debates over the bill in the Catalan parliament lasted 11 hours on Thursday, with opposition fiercely attacking the Catalan government for disrespecting democracy and the rule of law, both in the unconventional way the parliament passed the bill and because of its contents. However, an earlier vote in November 2014 did go ahead even after Spain's constitutional court declared it was not an official referendum.
The controversial law also defines the details of the referendum, such as the question, which will be: "Do you want Catalonia to be an independent state in the form of a Republic?".
Puigdemont's government claims it has a democratic mandate to seek a binding independence referendum based on the universal right to self-determination and the regional law approved Wednesday.
In order to facilitate the law adoption process, the supporters of Catalonia's independence have amended the parliament's standing orders. "They will not do it", he said.
Lawmakers who opposed independence abandoned the chamber before the vote, with some leaving Catalan flags in their empty seats.
Madrid meanwhile called on the country's Constitutional Court to declare the Catalan law null and void, describing the move by the Catalan parliament as "an act of force".
The Catalonia region's parliament has cleared the way for an independence vote that Spain's government contends is illegal.
"What is happening in the Catalan parliament is embarrassing, it's shameful", Saenz de Santamaria told reporters in Madrid. Central authorities have vowed to stop the vote.
The return to solid growth has weakened public backing for independence, although polls show that nearly eight out of 10 Catalans want to have the right to vote.
Prime Minister Mariano Rajoy called on Spain's constitutional court to nullify the bill the moment it was agreed.
In 2014, months after Scotland voted to stay in the United Kingdom, pro-independence campaigners staged a symbolic ballot, organised by volunteers rather than government officials to get around court restrictions.
The pair discussed opening a commission to evaluate updating and modernizing Spain's system of autonomous regions, which Rajoy is reported to have valued "positively".
Opponents of independence for the wealthy northeastern region of Spain greeted the decision with jeers.
Catalonia, a region of 7.5 million people with its own language and culture, accounts for about 20 percent of Spain's economic output, and has significant powers over matters such as education, healthcare and welfare.