The Liberal leadership race picked up momentum on Friday as Michael Ignatieff and Stephane Dion officially threw their hats into the ring.

Ignatieff, a newcomer to federal politics, ended months of speculation about his potential candidacy at a rally in Toronto Friday afternoon.

"I have come here to my riding of Etobicoke-Lakeshore to announce my candidacy for the leadership of the Liberal Party of Canada," Ignatieff told an excited crowd in a packed hall.

Ignatieff said he is a lifelong devoted Liberal, and entered the race to fight for party renewal.

"All my life I have been inspired by Canada, and now it's my turn to try and inspire my fellow citizens," he said.

"No one can do this alone. Good men and women have already answered the call, some are answering their cell phones as I speak."

Ignatieff said he was striving to revive faith "not just in the Liberal party, but in politics itself."

He described himself as a centre-left Liberal and made it clear that is the direction he intends to take the party, if elected.

"When you look at the votes that have been cast, my sense is the country is still deeply committed to left-of-centre progressive politics, when you add the votes given to the Liberal party and the other opposition parties. So I'm confident I've planted the standard in the right place," Ignatieff said during a question and answer period following the announcement.

The 58-year-old accomplished writer and academic left a distinguished post as a professor at Harvard University to run as an MP in Toronto after residing largely outside of the country for about 30 years.

He won the seat despite objections from many even within his own party about being parachuted into their midst.

Ignatieff has also been dogged by his initial support of the Iraq war.

Last week, Ignatieff clarified he had modified his position, saying his responsibility has "profoundly changed" since he was elected.

"We don't send Canadians to risk their lives overseas unless it has the consent of the Canadian people," he said.

The son of a high-ranking diplomat who served under Lester Pearson, Ignatieff has insisted he has never been out of touch with his Canadian roots despite his absence, and said it should not come as a surprise that he has entered politics.

Dion joins the race

Earlier Friday, Montreal MP and former cabinet minister Stephane Dion was the first candidate from Quebec to join the race for the leadership of the Liberal party, saying one of his top priorities was a healthy environment.

The foreign affairs critic, who served as environment minister for Paul Martin's government, announced his intentions at a news conference in Montreal.

"I'll be running for the leadership of the Liberal Party of Canada," said Dion, who is by far more politically seasoned than Ignatieff.

"I know my country, I know its potential and I also know its tremendous complexity."

Flanked by former Chrétien cabinet minister Don Boudria, who will chair his campaign, Dion focused his speech on the economy, social justice and the environment, arguing that all three were key components for a prosperous Canada.

He also accused Prime Minister Stephen Harper of failing to recognize those priorities.

"I want to help Canadians combine the stronger economy with greater social justice and a healthier environment," he said.

"I want to improve the quality of life of Canadians while Stephen Harper's policies will have the opposite effect. He doesn't understand that there will be no long-term prosperity without sustainable development."

Dion, 50, is probably best known for authoring the controversial Clarity Act, which specifies the federal government would negotiate separation only if a clear majority of Quebecers voted 'Yes' on a clear referendum question to secede.

"I'm proud of both my Quebec identity and my Canadian identity," he told reporters on Friday. "Identities are to be added, not subtracted."

Dion has been an MP since winning a byelection in a Montreal-area riding in March 1996.

His view of federalism has often been compared to that of former prime minister Pierre Trudeau, although Dion dismisses any similarities to the late Liberal icon.

Other contenders

Dion and Ignatieff's announcements came the day after Liberal MP Belinda Stronach ended months of speculation by revealing she was backing out of the leadership race.

Former Conservative-turned-Liberal MP Scott Brison says he hasn't yet decided whether to run for the leadership.

Others who have said they are considering entering the ring include former Ontario NDP premier Bob Rae, former Ontario education minister Gerard Kennedy and B.C. Liberal MP Hedy Fry.

The leadership race officially began Friday with the party issuing a call for an end-of-year convention in Montreal.

The campaigning is expected to begin during a short trip to Edmonton that begins Saturday, when more than a dozen declared and potential candidates make brief speeches and take part in a question-answer session.

The new Liberal leader will be chosen toward the end of the year.