A new method is presented for factorization of bivariate polynomials over any field of characteristic zero or of relatively large characteristic. It is based on a simple partial differential equation that gives a system of linear equations. As in Berlekamp’s and Niederreiter’s algorithms for factoring univariate polynomials, the dimension of the solution space of the linear system is equal to the number of absolutely irreducible factors of the polynomial to be factored, and any basis for the solution space gives a complete factorization by computing gcd’s and by factoring univariate polynomials over the ground field. The new method finds absolute and rational factorizations simultaneously and is easy to implement for finite fields, local fields, number fields, and the complex number field. The theory of the new method allows an effective Hilbert irreducibility theorem, thus an efficient reduction of polynomials from multivariate to bivariate.