Kindle owners will be able to access free ebooks from 11,000 US libraries.
Amazon has been long rumoured to be considering an ebook borrowing system, with reports of a soft launch in Seattle leaking out earlier this week.
The retail giant has now unveiled a network of public libraries that will offer free ebook loans via the OverDrive system. Users will need to have a library card in order to download.
Ebooks will be sent directly to Kindles over Wi-Fi or can be moved via USB, but not over 3G, Amazon said. The system will keep all notes and highlighted text just like a purchased ebook.
Those without a Kindle can use free apps to take out books on other devices. The length of loan times will depend on individual libraries, but reports suggest it will average two weeks, with a "courtesy reminder" sent three days before it's due back.
"We're even doing a little extra here - normally, making margin notes in library books is a big no-no," said Jay Marine, director of Amazon Kindle. "But we're fixing this by extending our Whispersync technology to library books, so your notes, highlights and bookmarks are always backed up and available the next time you check out the book or if you decide to buy the book."
We've yet to hear back from Amazon when ebook library lending might arrive in Australia.