30 October 2014
Last updated at 19:21 ET
Mr Compaore said he would hand over power once the transitional government had completed its term.
He also said he was lifting a "state of siege" he had declared earlier.
In the previous announcement, Mr Compaore called for the military to implement emergency measures.
This was followed by a press conference where army chief Gen Honore Traore announced that a "transitional body [would] be put in place in consultation with all parties".
"A return to the constitutional order is expected in no more than 12 months," he said.
Analysis: Thomas Fessy, BBC West Africa correspondent
The president said he was ready to open a political dialogue to set the terms of a transitional government that he would lead until the next presidential election. His current term ends in November next year, so staying in power now would be legal.
But would he be legitimate?
Opposition leaders and protesters say no. They want him to step down now.
President Compaore appeared to want to calm things down but he spoke like a man who still wants to decide when he goes.
That could be the recipe for more unrest.
Parliament was ransacked and set ablaze
Cars were also in flames
The defence forces have been trying to disperse the protesters
However, the general did not spell out who would lead the interim administration.
He also declared the imposition of an overnight curfew, as well as the dissolution of parliament.
In a message broadcast by a local TV station after the general's statement, Mr Compaore said he welcomed the military's "patriotic action".
He said he would hand over power to a democratically elected government after the transitional administration had completed its term.
He added that he was withdrawing a controversial law that would enable him to seek another term in office.
His plan to seek re-election triggered demonstrations in the capital, Ouagadougou. The protests are the most serious yet against Mr Compaore's rule.
The main opposition leader, Zephirin Diabre, had told a local radio station the state of emergency was unacceptable.
"We are calling on the people to show that they are against it," he was quoted as saying. "The resignation of President Blaise Compaore is the only thing that can bring peace to the country."
At least one person has been killed in the protests, says BBC Afrique's Yacouba Ouedraogo in the capital.
Mr Diabre said dozens of protesters had been killed across the country by the security forces in a "barbaric escalation of violence".
The military fired live bullets to try to disperse protesters who had occupied parliament, our correspondent says.
Protesters also surged towards the presidential palace, and a government helicopter flying overhead fired tear gas at them, Reuters news agency reported.
Witnesses say dozens of soldiers joined the protest in Ouagadougou's main square, including a former defence minister, Gen Kouame Lougue.
Protesters demanded his installation as president, our reporter says.
Blaise Compaore
The city hall, the homes of MPs, and an upmarket hotel in Ouagadougou were also set ablaze.
Similar protests hit the south-western city of Bobo Dioulasso, and other towns in the poor West African state.
State television went off air after protesters ransacked its headquarters.
UN chief Ban Ki-moon's special envoy for West Africa, Mohamed Ibn Chambas, will fly to Burkina Faso on Friday to try to ease the crisis, the UN said.
Mr Compaore first took power in a coup in 1987, and has won four disputed elections since then.
The protests forced the government to suspend Thursday's parliamentary vote on a constitutional amendment that would have lifted the limit on presidential terms so that Mr Compaore could run for office again in 2015.
Mr Compaore is a staunch ally of the US and France, which uses Burkina Faso as a base for military operations against militant Islamists in the Sahel region.
Burkina Faso president defies calls to step down
TO SEE VIDEO:
http://www.bbc.com/news/world-africa-29844123
A resident told the BBC he saw MPs' homes on fire, reports Lebo Diseko
Burkina
Faso's President Blaise Compaore says he will stay in power under a
transitional government, following a day of violent protests demanding
his resignation.
Earlier, demonstrators angered by his bid to extend his 27-year rule torched parliament and government buildings.Mr Compaore said he would hand over power once the transitional government had completed its term.
He also said he was lifting a "state of siege" he had declared earlier.
In the previous announcement, Mr Compaore called for the military to implement emergency measures.
This was followed by a press conference where army chief Gen Honore Traore announced that a "transitional body [would] be put in place in consultation with all parties".
"A return to the constitutional order is expected in no more than 12 months," he said.
The president said he was ready to open a political dialogue to set the terms of a transitional government that he would lead until the next presidential election. His current term ends in November next year, so staying in power now would be legal.
But would he be legitimate?
Opposition leaders and protesters say no. They want him to step down now.
President Compaore appeared to want to calm things down but he spoke like a man who still wants to decide when he goes.
That could be the recipe for more unrest.
Parliament was ransacked and set ablaze
Cars were also in flames
The defence forces have been trying to disperse the protesters
He also declared the imposition of an overnight curfew, as well as the dissolution of parliament.
In a message broadcast by a local TV station after the general's statement, Mr Compaore said he welcomed the military's "patriotic action".
He said he would hand over power to a democratically elected government after the transitional administration had completed its term.
He added that he was withdrawing a controversial law that would enable him to seek another term in office.
His plan to seek re-election triggered demonstrations in the capital, Ouagadougou. The protests are the most serious yet against Mr Compaore's rule.
The BBC's Laeila Adjovi: "All around me there's black smoke"
"We are calling on the people to show that they are against it," he was quoted as saying. "The resignation of President Blaise Compaore is the only thing that can bring peace to the country."
At least one person has been killed in the protests, says BBC Afrique's Yacouba Ouedraogo in the capital.
Mr Diabre said dozens of protesters had been killed across the country by the security forces in a "barbaric escalation of violence".
The military fired live bullets to try to disperse protesters who had occupied parliament, our correspondent says.
Protesters also surged towards the presidential palace, and a government helicopter flying overhead fired tear gas at them, Reuters news agency reported.
Witnesses say dozens of soldiers joined the protest in Ouagadougou's main square, including a former defence minister, Gen Kouame Lougue.
Protesters demanded his installation as president, our reporter says.
President Blaise Compaore spoke to the BBC earlier this week
- Served under President Thomas Sankara as minister of state to the presidency
- Took power after Sankara was killed in mysterious circumstances by a group of soldiers in 1987
- First elected president in 1991 and again in 1998
- A new constitution in 2000 limited presidents to two terms in office, and limited terms to five years
- Won two further terms
- Protests at attempts to amend the term limits began a year ago, fuelled by the high cost of living
Similar protests hit the south-western city of Bobo Dioulasso, and other towns in the poor West African state.
State television went off air after protesters ransacked its headquarters.
UN chief Ban Ki-moon's special envoy for West Africa, Mohamed Ibn Chambas, will fly to Burkina Faso on Friday to try to ease the crisis, the UN said.
The protests forced the government to suspend Thursday's parliamentary vote on a constitutional amendment that would have lifted the limit on presidential terms so that Mr Compaore could run for office again in 2015.
Mr Compaore is a staunch ally of the US and France, which uses Burkina Faso as a base for military operations against militant Islamists in the Sahel region.
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