New rules agreed by the European Parliament will force mobile operators to lower the prices of making a call or downloading data abroad by July 2012.
Once the rules are in force, mobile users will pay no more than 24p a minute to make a call, 7.5p to send a text, and 59p per megabyte for data downloads across Europe.
"Consumers are fed up with being ripped off," said commissioner Neelie Kroes, the European Commission vice-president for the Digital Agenda.
"The new roaming deal gives us a long-term structural solution with lower prices, more choice and a new smart approach for data and internet browsing."
Currently, calls can be charged at up to 30p a minute, texts cost 9p, and there is no limit to what companies can charge for a megabyte of data.
By July 2014, mobile users will be given the option of shopping around for the best deal and signing a separate mobile contract using their existing number when going abroad, according to the BBC.
By then, the aim is to have reduced roaming costs to no more than 15p to make a call and 16p for a megabyte of data. The cost of receiving a call will fall to 4p and sending a text to 5p.
But in February, a group comprising a UK mobile operator, consumer groups, trade bodies and industry associations said the planned cuts were not deep enough.
The group called on UK communications minister Ed Vaizey to push for deeper cost cuts to bring roaming charges more in line with UK tariffs.
Under the new rates, 1GB of data will cost £160 by 2014, compared with UK domestic prices of less than £10.
For citizens travelling outside the EU, there are also plans for better information about roaming charges to avoid "bill shock" that include alerts when data downloads are nearing €50 (£41).
With the roll out of 4G networks that offer even faster download speeds, data consumption is expected to rise exponentially.