Unveiling the iPhone 6 and iPhone 6 Plus, Apple chief Tim Cook said the company was launching "the biggest advancement in the history of iPhones."
Apple senior vice president Phil Schiller, speaking in Cupertino, California, said the new iPhones were "simply stunning" with polarized glass displays and bodies that are "thinner than ever before."
"These are the best phones ever made," Schiller said, as he described the new devices at a major set-piece event streamed live online.
The new iPhone 6 will start at the same price of existing iPhones at $199 for US customers while the iPhone 6 Plus will be at $299 with a two-year contract.
Apple will cut the price of existing iPhone 5S and 5C with the launch.
Apple's move, expanding the latest iPhone with a four-inch screen, comes as consumers are switching to handsets with bigger displays to watch videos and browse the Internet.
Observers say the timing is right for Apple to introduce a generation of iPhone 6 models with screen sizes stretched to tap into users' love for "phablets" that combine the features of smartphones and tablets.
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