In 1976, Cameron, Goethals, Seidel, and Shult classified all the graphs whose smallest eigenvalue is at least
$-2$ by relating such graphs to root systems that appear in the classification of semisimple Lie algebras. In this paper, extending their beautiful theorem, we give a complete classification of all connected graphs whose smallest eigenvalue lies in
$(\! -\lambda ^*, -2)$, where
$\lambda ^* = ho ^{1/2} + ho ^{-1/2} \approx 2.01980$, and
$ho$ is the unique real root of
$x^3 = x + 1$. Our result is the first classification of infinitely many connected graphs with their smallest eigenvalue in
$(\! -\lambda , -2)$ for any constant
$\lambda \gt 2$.