Updated

Thousands of police guarded ballot boxes Tuesday and rival terrorists pledged not to disrupt voting on the eve of the first Palestinian parliament election in a decade — a cliffhanger vote on whether to pursue peace or confrontation with Israel.

The battle between the ruling Fatah Party and its Islamic Hamas rival was sure to tilt the balance of a Middle East torn between reform and traditionalism. But concerns over lawlessness, corruption and unemployment also weighed on voters' minds.

Some undecided voters said they want to punish Fatah for years of mismanagement, but fear Hamas will usher in an Islamic theocracy.

"We hope to see change in the Palestinian Authority, that those who were stealing money will be replaced ... and to have peace with Israel," said Jaber Saadeh, a 50-year-old unemployed construction worker who since the outbreak of the Palestinian uprising in 2000 has been living on a $150-a-month handout from a U.N. aid agency.

The Palestinians are at a crossroads, said pollster Nader Said. "For the Palestinians, the whole national agenda is on the table," he said. "Do they want continuity or do they want change?"

Hamas predicted victory, but pollsters said the race was too close to call, especially with many wild cards in play, including possible violence. Rain forecast for Wednesday could give an edge to Hamas with its ideologically more committed electorate.

Despite the fierce rivalry, Hamas and Fatah signaled they are ready to work together. Palestinian leader Mahmoud Abbas has spoken to Hamas leaders about possible cooperation after the election, said Hamas spokesman and parliament candidate Mushir al-Masri.

"We could find common ground," said al-Masri, sitting in a green campaign tent in the town of Beit Lahiya in Gaza. "Hamas will not be in the government by itself."

Hamas is expected to ask for service ministries — health, education and welfare — and to leave diplomacy, including contacts with Israel, to others. Hamas, which has long ruled out negotiations with Israel, has signaled some flexibility on the issue recently, but may not be ready for a dramatic shift of positions.

Fatah also said it expects to win; Palestinian Information Minister Nabil Shaath predicted Fatah would get more than half the 132 parliament seats. If forced to form a coalition, the party prefers to govern with smaller parties and would invite Hamas only if it has no choice.

Former Gaza strongman Mohammed Dahlan, a leading Fatah candidate, said he's not opposed to bringing Hamas into the government. "Hamas can't behave like an opposition (party) if it's in the PNA," Dahlan told the British Broadcasting Corp., referring to the Palestinian government.

Israel has said it would not deal with Hamas politicians, and the U.S. and Europe have said some foreign aid to the Palestinian Authority would be in jeopardy if Hamas joins the government.

Israel's acting prime minister, Ehud Olmert, said Wednesday he hoped Palestinians would not "choose again the extremists who have led them from tragedy to tragedy and to sorrowful lives."

Many in Fatah said that despite the risks of losing power, the election will finally gauge Hamas' strength and force it to assume responsibility. "We want to face the boogeyman," Fatah voter Rafik Abu Mariam said of Hamas.

Wednesday's election marks the first time Palestinians have a clear choice between two political camps — Hamas boycotted the 1996 vote — and pollsters predicted a turnout of more than 75 percent of the 1.3 million eligible voters.

Nearly 20,000 local observers and 950 international monitors, led by former President Jimmy Carter, were scheduled to watch the vote. There were some allegations of fraud in the 1996 parliament election and the 2005 presidential election that brought Abbas to power, but international monitors said at the time the problems were not widespread.

Starting Tuesday, some 13,000 police officers began protecting 1,008 polling stations across the West Bank and Gaza. Officers rode shotgun on trucks carrying ballot boxes, and took up positions on rooftops of schools where voters were to cast ballots from 7 a.m. to 7 p.m. Walls of polling stations were plastered with signs of crossed-out guns, a reminder that no weapons are allowed inside.

In Gaza, gunmen linked to Hamas and Fatah said they would stash their weapons away on voting day. All groups want the election to succeed, said Abu Adham, a spokesman for the Fatah-allied Al Aqsa Martyrs' Brigades. In December, Al Aqsa gunmen dispatched by disgruntled candidates derailed Fatah primaries in Gaza, storming several polling stations.

With guns plentiful and emotions running high, police sent reinforcements to potential trouble spots, such as the West Bank's refugee camp of Balata, an Al Aqsa stronghold.

In the first sign of trouble, Al Aqsa gunmen killed a Fatah politician, Abu Ahmed Hassouna, 44, in the West Bank city of Nablus on Tuesday after he told them to stop firing at election posters on his home.

About 1,000 of his supporters marched to protest the shooting. "Enough security chaos, we want to live in freedom," they shouted.

In Gaza, a senior Palestinian security official said he had established a hot line to Hamas and Fatah to deal with possible problems. He said he was more concerned about possible clan violence than party feuding.

Some voters were undecided Tuesday.

In Beit Hanoun, a town in northern Gaza, five neighbors idling away a sunny morning while sitting in a circle on a sidewalk said they had thought hard about their votes.

Saadeh, the jobless construction worker, is married to three women and a father of 24. He said he was disappointed in Fatah but thought Hamas was far worse, and that he would give Fatah another chance.

Falah Abu Odeh, 45, said he is shifting from Fatah to either Hamas or a small independent party. "In 10 years, they (Fatah) offered us nothing. We got nothing," said Abu Odeh, who works in the Health Ministry. In any case, he said, peace with Israel is impossible.