The Bush administration formally resumed diplomatic relations with Libya yesterday, demonstrating continued faith in Libyan leader Moammar Gaddafi and his assertions that he has renounced terrorism and a quest for weapons of mass destruction.

With a letter from President Bush and the ceremonial opening of a U.S. Liaison Office in Tripoli, the administration took the firmest step yet in officially restoring a relationship that was severed 24 years ago because of Libya's support of terrorism.

The practical effects of yesterday's move will be negligible, since the liaison office has been operating for about two months, said a State Department spokesman, who likened the event to a ribbon-cutting. But it solidifies the U.S. administration's political rehabilitation of Gaddafi.

U.S. authorities are undeterred by allegations by an imprisoned U.S. Muslim activist that Gaddafi plotted last year to assassinate Saudi Arabia's Crown Prince Abdullah, even as Gaddafi was negotiating a return to the good graces of the U.S. and British governments.

Abdurahman Alamoudi, a prominent figure in Northern Virginia's Muslim community now held in an Alexandria jail, has said he met with Gaddafi twice in 2003. His account was corroborated by Col. Mohamed Ismael, a Libyan intelligence official in Saudi custody, but investigators remain unconvinced.

"We are looking into these reports. We are trying to establish their veracity or not. That veracity has not yet been fully established," State Department spokesman J. Adam Ereli told reporters. He said reports of the plot are "a matter of concern."

The Libyan government rejected the allegations late last year and told U.S. authorities that Libya would not use violence to settle political differences or destabilize another country.

William J. Burns, the State Department's top Middle East official, and J. Cofer Black, the department's senior terrorism expert, raised the case with Gaddafi yesterday, according to a U.S. statement. Nothing emerged to derail the opening of the diplomatic office.

"If we'd gotten any information that would contradict what the Libyans had previously said, we would've included it in the statement," a State Department spokesman said.

Gaddafi, targeted by U.S. bombs during the Reagan administration, has long been eager for a lifting of sanctions and a resumption of investment by U.S. corporations in the oil-rich North African country. Surrendering his programs for developing unconventional weapons cleared the way for sanctions to be partially lifted earlier this year.

The Bush administration has told Gaddafi that ending sanctions and resuming full diplomatic and economic ties depend on a good performance on terrorism. Yesterday's meetings, according to the U.S. statement in Tripoli, included "detailed discussions" on Libya's "pledge to cease all support for terrorism."

Among the topics was the U.S. interest in opening a land route through Libya to neighboring Sudan to ease the humanitarian crisis in Darfur. Secretary of State Colin L. Powell and U.N. Secretary General Kofi Annan are to visit Sudan this week.