Israeli troops handed this quiet West Bank town to Palestinian security control Wednesday, dismantling a checkpoint and easing travel restrictions in what was seen as a message to ordinary Palestinians that an informal truce is starting to pay off.

Throughout the day, Israeli and Palestinian security commanders met repeatedly to coordinate the handover. At one point, Israeli and Palestinian officers climbed atop an Israeli watchtower for a better view.

Israeli soldiers lowered their national flag as flatbed trucks drove away with concrete blocks that made up one of three checkpoints ringing Jericho (search).

The handover was largely completed by midday, with Palestinian police taking up new positions. However, the formal ceremony, which was to have taken place in mid-afternoon, was delayed because of confusion over whether the handover protocol should be signed or sealed only with a handshake.

The Palestinians insisted on a signature, and the Israelis said that meant they would have to show the document to a legal adviser. More than an hour later, officers from both sides returned for the signing ceremony at a liaison office on the outskirts of Jericho.

Jericho is the first of five West Bank towns to revert to Palestinian control in coming weeks, part of an attempt to restore the situation that existed before the outbreak of fighting in September 2000.

As part of the pullback, two other barriers were to remain in place during a monthlong period in which the ability of the Palestinian forces to keep calm will be tested. The Palestinians had insisted that all checkpoints be removed but accepted the compromise.

On Wednesday morning, Israeli and Palestinian commanders patrolled the area together to affirm the planned changes on the ground, ending the trip with a handshake. At one point, officers climbed atop an Israeli watchtower for a better view.

Israeli flatbed trucks began removing cement blocks at one of the roadblocks, and a soldier pulled camouflage netting off a watchtower. Another soldier removed an Israeli flag from the checkpoint and rolled it up. Palestinian forces took up positions in another area.

Israeli travel restrictions have severely hampered daily life in the West Bank and Gaza Strip in more than four years of fighting, and the removal of barriers sends a message to ordinary Palestinians that an informal truce with Israel is beginning to pay off.

Israel erected dozens of barriers across the West Bank to prevent Palestinian suicide bombers and gunmen from reaching Israeli targets. Hundreds of Israelis have been killed in attacks by militants since 2000.

Palestinians found it difficult to believe their lives are going to improve.

"A prisoner living in a cell will always be very glad when the guards open a window," said Issa Saasine, a plastics trader visiting Jericho from the West Bank city of Hebron (search). "Any small improvement is welcome, but more is needed to bring about confidence and stability."

In the past four years, Israeli troops have rarely entered Jericho, a farming and resort town that has largely stayed out of the fighting.

Palestinian negotiator Saeb Erekat (search), a resident of Jericho, said the handover of the town is the first step in returning to the situation before the outbreak of fighting on Sept. 28, 2000.

"The point is we are trying to get things back ... gradually, hoping that through peace and negotiations things will change," he said.

Maj. Sharon Assman, an Israeli army officer involved in the handover, said it was now up to the Palestinians to keep militants in check and ensure calm.

"There will be additional meetings to consider additional easings of restrictions. This will depend on ... guarantees of the Palestinian security forces that they will fight terror," he said.

As part of the handover, 17 Palestinian fugitives in Jericho were taken off Israel's wanted list, Erekat said. The fate of two top militants jailed under international supervision in Jericho, including the mastermind of the assassination of an Israeli Cabinet minister, remains unclear.

Palestinian leader Mahmoud Abbas (search) said Tuesday the two militants would be released, sparking outrage among Israeli leaders. Erekat later said no agreement has been reached.

As part of the handover, Israel eased checks at the main roadblock at the southern entrance to Jericho, allowing incoming traffic through without inspection. This could translate into a small boost for the local economy, which depends on tourism.

Outgoing cars were only to be checked sporadically. In the past, long lines often formed in either direction.

Jericho will remain off-limits to Israelis for the time being, Israeli commanders said. Before the outbreak of fighting, thousands of Israelis would visit the town on weekends, many drawn by a luxury hotel and casino.

Violence has dropped considerably since the Mideast summit, but militant groups like Hamas (search) and Islamic Jihad (search) have not formally joined a cease-fire. Islamic Jihad carried out a suicide bombing in Tel Aviv on Feb. 25, killing five Israelis and endangering the truce.

The West Bank town of Tulkarem (search) was next to be handed over, in coming days. That would be followed by Qalqiliya (search), just south of Tulkarem, according the understandings. No date has been set for the handover of the remaining two — Bethlehem (search) and Ramallah (search).

Not on the list at all are two West Bank cities, Nablus (search) and Hebron, and another town, Jenin (search). Israel maintains a tight military grip on those three places, charging that they are hotbeds of militant activity.

Also Wednesday, an Israeli settler was shot and slightly wounded in Hebron, the army said. Local security guards said two Palestinians helped the wounded man to a nearby settlement where he called for medical help.

In Egypt, Palestinian leaders tried for a second day to persuade militant factions to call a one-year cease-fire.

Egyptian President Hosni Mubarak (search) met with Abbas, who faces a tough sell on a cease-fire.

Hamas says it is willing only to extend an informal period of "calm" in attacks — and that only on condition Israel halts military operations against Palestinians and frees Palestinian prisoners.

In the first day of internal talks Tuesday, the militant groups appeared unenthusiastic, refusing to give up their weapons.

Hamas, which has carried out dozens of suicide bombings against Israel since its founding in 1987, opposes peace talks and remains committed to Israel's eventual destruction.