This agreement seeks to implement United Nations Security Council Resolution 338 dated 22 October 1973. The agreement establishes a zone of separation, calls for the disengagement of forces and the release of prisoners of war. It also authorises the United Nations Disengagement Observer Force (UNDOF) to supervise the agreement.

This agreement establishes a zone of separation and calls for the disengagement of forces. This agreement was also known as the Sinai Separation of Forces Agreement  (later known as Sinai I). Under its terms, Israel withdrew its forces from the areas west of the Suez Canal held since the October 1973 ceasefire and also pulled back several miles on the Sinai front east of the canal, where three roughly parallel security zones were created, each about six miles wide, for Egyptian, UN, and Israeli buffer zones.

The resolution calls for all parties to cease all firing and terminate all military activities immediately. The parties should implement Security Council Resolution 242 (1967) in all of its parts and immediately and concurrently with the ceasefire, start negotiations with an aim to establish a just and durable peace in the Middle East.