Israel's Cabinet voted Sunday to leave Gaza (search) after 38 years of occupation, the last formality before the handover of the teeming coastal area to Palestinian control.
But the withdrawal, expected to be completed early Monday, was marred by dispute and uncertainty. The Palestinians said they would boycott a planned handover ceremony later Sunday to protest against the failure to reach an agreement on a vital border crossing and the expected decision by Israel not to demolish about two dozen synagogues in Gaza.
"They throw these two problems in our faces, and it's really unfair," said Palestinian negotiator Saeb Erekat.
The Cabinet's unanimous decision Sunday to end military rule over Gaza was largely symbolic. Israel has already withdrawn all of its thousands of Jewish settlers from Gaza, leaving only a small military presence there. But the unanimous decision finalized the historic withdrawal nearly two years after Prime Minister Ariel Sharon (search) first proposed the pullout.
The pullout marks the first time the Palestinians will have control over a large, defined territory they claim for a future independent state.
However, the Palestinians fear Israelis will not make further territorial concessions on the West Bank. The Palestinians hope to build their state in Gaza, the West Bank and east Jerusalem — areas that Israel captured in the 1967 Mideast War.
Despite Sunday's vote, two sticking points remained: control over Gaza's volatile border with Egypt and the fate of the synagogues left behind in the demolished Jewish settlements.
The Palestinians want full control over the Gaza-Egypt border, saying free movement of people and goods is essential for rebuilding Gaza's shattered economy. Israel wants to retain some control, at least temporarily, fearing that militants will smuggle weapons into Gaza.
Israel last week unilaterally closed the vital Rafah border crossing — the main gateway for Gaza's 1.3 million Palestinians to the outside world. In what Israel called a major concession, it agreed in principle to allow Palestinians to travel freely through the crossing under the supervision of international monitors.
But Israel said it could be months before the border reopens, and a final deal would depend on Palestinian willingness to crack down on militant groups. In the meantime, it plans to reroute border traffic through alternate Israeli-controlled crossings and turning security control of the border to Egyptian forces.
Palestinian officials angrily announced a boycott of a handover ceremony scheduled Sunday with Israeli military commanders to protest the deadlock.
"As long as the border crossing is closed, we consider Gaza still occupied," said Sufian Abu Zaydeh, a Palestinian Cabinet minister.
The Palestinians say that Israel is not really ending its occupation of Gaza as long as it continues to control airspace, territorial waters and border crossings.
Egypt's intelligence chief, Omar Suleiman, is expected in Gaza soon to try to wrap up a deal over the Rafah crossing. Suleiman has been a key mediator throughout the preparations for the Gaza handover.
Some 200 Egyptian border guards took up position along the Gaza border Saturday to prevent arms smuggling and illicit crossings. An additional 550 Egyptian soldiers are to be assigned to the desert frontier during the coming week, an Egyptian official said.
Also Sunday, the Cabinet was expected to vote against demolishing the Gaza synagogues, even though a year ago the same ministers approved the demolition as part of the pullout. Critics said last-minute political considerations — including a desire to win the support of leading rabbis ahead of general elections — prompted several Cabinet members to change their minds.
The Palestinians have detailed plans for the settlement areas, and the synagogues would be in the way. However, they fear international criticism if they demolish the buildings or if the structures are defaced by Palestinian crowds targeting symbols of occupation.
"Symbols of the occupation have to be taken down," Hisham Abdel Razek (search), a Palestinian lawmaker, told Israel's Army Radio.
Sharon told the Cabinet on Sunday that he opposes the demolitions, participants said. Sharon had previously wavered on the issue.
Cabinet Minister Haim Ramon said the rabbis are aware that the Palestinians will likely knock down the buildings later on. "They (rabbis) know the terrible consequences for Israeli-Palestinian relations if the Palestinians will demolish the synagogues," Ramon told Army Radio.
Gaza has shown increasing signs of lawlessness ahead of the Israeli withdrawal. In the latest unrest, gunmen briefly abducted an Italian journalist, seized two government buildings and fired shots at a third on Saturday.
Some 15,000 Palestinian security forces are to be deployed around the settlement area by the time the last Israeli soldiers are leaving Monday morning, to keep out large crowds celebrating the pullout.
After years of fighting with Israel, Palestinian security forces have been severely weakened, enabling armed gangs to operate with virtual impunity in Gaza. Adding to the tensions, rival factions are jockeying for power ahead of the pullout.
Israeli construction crews, meanwhile, were fortifying the border with Gaza with a massive 30-foot-high concrete barrier to prevent infiltrations. Gaza is already separate from Israel by a large fence.
Israel threatened on Saturday to deliver an unprecedentedly harsh response to any attacks from Gaza after Israeli troops leave the territory.