The laptop was designed to be used in developing countries

The South American country has bought 100,000 of the machines for schoolchildren aged six to 12.

A further 300,000 may be purchased to provide a machine for every child in the country by 2009.

The order will be a boost for the One Laptop per Child (OLPC) organisation behind the project which has admitted difficulties getting concrete orders.

"I have to some degree underestimated the difference between shaking the hand of a head of state and having a cheque written," Nicholas Negroponte, the founder of the organisation, recently told the New York Times.

However, he said he was "delighted" with the first deal.

"We commend Uruguay for being the first country to take concrete actions to provide laptops to all its children and teachers and look forward to other countries following this example," he said.

Rumour factory

The XO laptop, as the machine is known, has been developed to be used primarily by children in the developing world.

It is durable, waterproof and can be powered by solar, foot-pump or pull-string powered chargers. It includes a sunlight readable display so that it can be used outside and has no moving parts.

OLPC aims to sell the laptop for $100 or less. However, over the last year, the machine's price has steadily increased and now costs $188 (£93).

Governments were initially offered the green and white machines in lots of 250,000. However, this has since changed and there are now a variety of ways that the laptops are sold or distributed.

For example, from 12 November, members of the public can buy a machine for themselves as well as one for a child in a developing country.

The Give 1 Get 1 (G1G1) programme will initially distribute laptops to Cambodia, Afghanistan, Rwanda and Haiti.

Other schemes allow donors to purchase lots of 100 or more of the machines for a country of their choice. Prices start at $299 (£145) per machine.

Connected country

However, the main focus for OLPC has been selling the machines direct to governments.

The $100 has already been tested in many countries

In July, hardware suppliers were told to ramp-up production of all of the components needed to build the low-cost machines.

Many believed that the decision meant that the organisation had met or surpassed the three million orders it need to make production viable. However, the latest news suggests this was not the case.

Previous reports had also suggested deals with the governments of Libya, to provide a laptop for every child, as well as Peru and a sponsorship programme with Italy to provide 50,000 machines to Ethiopia.

A spokesperson for OLPC said none of these were confirmed deals.

Instead, Uruguay is the first country to sign up for the scheme.

The order for 100,000 machines was placed by the state-run Laboratorio Tecnológico del Uruguay (Latu) which runs a large scale education and communications project known as Ceibal.

The scheme will also provide connectivity to all of the schools involved.

Before placing the order, Latu had also evaluated the rival Intel Classmate PC.

Initially the XO laptops will be distributed in eight to nine of the country's 19 regions. A further 300,000 machines will provide machines for all of the country's children.

"We will also cover the rest of the country later in 2008 and Montevideo in 2009," said Miguel Brechner, president of the organisation.