Yasser Arafat's (search) body is being flown from Paris to Cairo, where a funeral service attended by foreign dignitaries will be held for him Friday morning.

Arafat's body will then be flown by helicopter to his Ramallah compound, called the Muqata, for services and burial in a mausoleum later in the day.

The Israeli military said it would restrict access to the burial, allowing only Palestinians with permits to attend, but would allow mourners to hold processions in towns and refugee camps.

The Palestinian leader always said he wanted to die as a martyr, but died instead of old age and a mysterious illness Thursday morning in a French military hospital.

Arafat's widow, Suha, wearing black coat and pants, stifled sobs as the Palestinian flag-draped coffin of her 75-year-old husband was carried off a military helicopter to an official French aircraft. The aircraft then left for Cairo, Egypt, where funeral services will be held Friday.

Arafat, 75, died at 3:30 a.m. Paris time, and as his passing was announced, a wave of grief swept across the West Bank and Gaza Strip.

Thousands of Palestinians ran into the streets, clutching his photograph, crying and wondering about their future without the man who embodied their struggle for statehood.

"He is our father," Namia Abu-Safia, 48, said sobbing in the Jebaliya refugee camp (search) in the Gaza Strip. "He is Palestine."

In a hurried effort to project continuity, the PLO elected former Palestinian Prime Minister Mahmoud Abbas (search) as its new chief, virtually ensuring that he would succeed Arafat as leader of the Palestinians, at least in the short term.

The Palestinian legislature also swore in Parliament Speaker Rauhi Fattouh (search) as caretaker president of the Palestinian Authority until elections could be held in 60 days according to Palestinian law.

Hundreds of mourners lining the streets near the Percy Military Training Hospital outside Paris shouted, "From Paris to Jerusalem, we are all Palestinians!," as Arafat's body was brought to a French army helicopter for a short flight to Villacoublay military airfield.

There, a band played somber music at a small ceremony involving French Prime Minister Jean-Pierre Raffarin, Palestinian officials and Suha Arafat. The coffin was borne by eight Republican Guard pallbearers past an honor guard.

Egypt frantically prepared for the funeral service in a military club north of Cairo followed by a short procession led by a horse-drawn carriage. Security forces at Cairo's airport and elsewhere were put on maximum alert for the arrivals of heads of state and other dignitaries.

Palestinians will remember him as an icon, a father figure and a symbol of resistance against the Jewish state.

But Israelis will remember him as an arch-terrorist — their nemesis for nearly 40 years.

His death marked the end of an era in modern Middle East history, and prompted calls from President Bush and other world leaders to seize the moment to spur new efforts at Israeli-Palestinian peacemaking.

Bush said Arafat's death was a "significant moment" in Palestinian history and expressed hope that the Palestinians would achieve statehood and peace with Israel.

"During the period of transition that is ahead, we urge all in the region and throughout the world to join in helping make progress toward these goals and toward the ultimate goal of peace," Bush said.

Israeli Prime Minister Ariel Sharon (search), who had shunned his longtime enemy as a terrorist and obstructionist, said Arafat's death could serve as an "historic turning point in the Middle East" and expressed hope that the Palestinians would now work to stop terrorism.

Sharon refused to mention Arafat by name.

Arafat's History

Arafat took over the Palestine Liberation Organization (search), until then controlled by neighboring Arab countries, after Israel's crushing defeat of combined Egyptian, Jordanian and Syrian armies in the 1967 Six Day War.

His Fatah movement had been founded in 1956 as an underground, indigenously Palestinian movement whose goal was to carry out armed struggle against Israel

Arafat then used a combination of showcase terrorism — dramatic, globally televised plane hijackings and hostage-takings in the 1970's and '80's — and persistent diplomacy to make the plight of the Palestinian people an issue the world could not forget.

He justified the use of violence: "As long as the world saw Palestinians as no more than refugees standing in line for U.N. rations, it was not likely to respect them. Now that the Palestinians carry rifles, the situation has changed."

But Arafat later found himself on the wrong side of history. In the post-Sept. 11 world, the more murderous form of terrorism practiced by Al Qaeda, the non-PLO Palestinian Islamic group Hamas (search) and Fatah's own Al-Aqsa Martyrs' Brigades (search) disgusted the world, leading the United States and Israel to refuse to deal with him.

In early 2001, at the conclusion of talks instigated by outgoing President Bill Clinton, Arafat rejected a deal offered him by then-Israeli Prime Minister Ehud Barak that would have given the Palestinians the entire Gaza Strip, 95 percent of the West Bank, Arab neighborhoods in East Jerusalem and control of the Temple Mount in the heart of the holy city.

Arafat reportedly balked because the offer did not give the estimated 2 million Palestinian refugees the right to return to ancestral homes inside Israel. He also said signing the deal would be akin to signing his own death warrant.

His crowning irony was that although he, more than any other individual, had put the Palestinians as a people on the map, he had failed to create a state to house them.

"I offer my condolences to Yasser Arafat's family, his partners in the PLO and to the Palestinian people who are grieving the passing of the man who symbolized their hopes and aspirations for so long," Clinton said in a statement. "However others viewed him, the Palestinians saw him as the father of their nation. I regret that in 2000 he missed the opportunity to bring that nation into being and pray for the day when the dreams of the Palestinian people for a state and a better life will be realized in a just and lasting peace."

On Thursday morning, black smoke from burning tires rose across the Gaza Strip and gunmen fired into the air in grief.

Palestinian flags at Arafat's battered compound in Ramallah on the West Bank were lowered to half staff. Somber music played on the radio, church bells rang out, and Quranic verses were played for hours over mosque loudspeakers.

Fearing the mourning could rapidly turn into rioting, Israel quickly sealed off the West Bank and Gaza Strip and increased security at Jewish settlements.

The death of Arafat, who ruled over squabbling Palestinian factions for nearly four decades, left Palestinians without a strong leader for the first time. It raised concern that the scramble to claim Arafat's mantle could fragment the Palestinian leadership or spark chaos and factional fighting in the streets.

Palestinians Want 'Road Map'

Sharon, insisting that it was impossible to discuss peace with Arafat, had over the past year pushed forward with his "unilateral disengagement" plan, under which Israel would evacuate the Gaza Strip in 2005, abandon some isolated West Bank settlements and finish a barrier to separate Israelis from Palestinians.

Nabil Shaath (search), the Palestinian foreign minister, called on Israel after Arafat's death to resume implementation of the U.S.-backed "road map" peace plan. He told The Associated Press that Israel had used its dislike for Arafat as an excuse for avoiding obligations to withdraw from West Bank towns.

"Now, the road is open, and we are telling the Israelis, welcome. If you want to implement the road map, then implement it," Shaath said. "It was the path of President Arafat, and we will go on the path of Arafat."

French President Jacques Chirac (search) eulogized Arafat as a "man of courage and conviction who, for 40 years, has been the incarnation of the Palestinians' combat for recognition of their national rights."

Arafat was flown to a French military hospital in Clamart, outside of Paris, on Oct. 29 after his health began deteriorating. It was the first time in nearly three years that he had left his compound in Ramallah.

Neither Arafat's doctors nor Palestinian leaders would say what killed him.

"He closed his eyes and his big heart stopped. He left for God but he is still among this great people," said senior Arafat aide Tayeb Abdel Rahim, who broke into tears as he announced Arafat's death.

The Palestinians had demanded Arafat be buried in Jerusalem on the Temple Mount, the disputed holy site that once held the biblical Jewish temples and where now stand the Al-Aqsa Mosque, Islam's third holiest shrine, and the Dome of the Rock, the universally recognized symbol of the city.

Israel refused, fearing a Jerusalem burial would strengthen Palestinian claims to a city envisioned as capital of a future Palestinian state.

In a compromise, the Palestinians agreed to bury Arafat at his compound in Ramallah, battered and strewn with rubble from repeated Israeli raids.

But they plan to line his grave with soil taken from the Al Aqsa Mosque compound, said Ahmed Ghneim, a Fatah leader, and he is to be interred in a cement box, so he can be moved to Jerusalem for burial when the opportunity presents itself.

Seldom seen in public without his military uniform and his checkered keffiyeh headdress folded into the shape of Palestine, Arafat kept the Palestinian cause at the center of the Arab-Israeli conflict. But along with other secular Arab leaders of his generation, he saw his influence weakened by the rise of radical Islam in recent years.

Revered by his own people, Arafat was reviled by many others. He was accused of secretly fomenting attacks on Israelis while proclaiming brotherhood and claiming to have put terrorism aside. Many Israelis felt the paunchy 5-foot, 2-inch Palestinian's real goal remained the destruction of the Jewish state.

'A Freedom Fighter's Gun'

Arafat became one of the world's most familiar faces after addressing the U.N. General Assembly in New York in 1974, when he entered the chamber wearing an empty holster and carrying a twig.

"Today I have come bearing an olive branch and a freedom fighter's gun," he said. "Do not let the olive branch fall from my hand."

Two decades later, he shook hands at the White House with Israeli Prime Minister Yitzhak Rabin (search) at the signing of a peace deal that formally recognized Israel's right to exist while granting the Palestinians limited self-rule in the West Bank and Gaza Strip.

The pact led to the 1994 Nobel Peace Prize for Arafat, Rabin and then-Israeli Foreign Minister Shimon Peres (search).

But the accord quickly unraveled amid mutual suspicions and accusations of treaty violations. A new round of violence that erupted in the fall of 2000 has killed some 4,000 people, three-quarters of them Palestinians.

"The biggest mistake of Arafat was when he turned to terror. His greatest achievements were when he tried to build peace," Peres said.

The Israeli and U.S. governments said Arafat deserved much of the blame for the derailing of the peace process. Even many of his own people began whispering against Arafat, expressing disgruntlement over corruption, lawlessness and the bad economy in the Palestinian areas.

A resilient survivor of war with Israel and Jordan, numerous assassination attempts by both Israel and other Arabs and even a deadly plane crash, Arafat was born Rahman Abdel-Raouf Arafat Al-Qudwa on Aug. 4, 1929, the fifth of seven children of a Palestinian merchant killed in the 1948 war over Israel's creation.

Arafat insisted he was born in Jerusalem, but most biographers think he was born either in Gaza or in Cairo.

Educated as an engineer in Egypt, Arafat served in the Egyptian army and then started a construction firm in Kuwait. It was there that he founded the Fatah movement, which became the core of the PLO.

FOX News' Jennifer Griffin, Paul Wagenseil and The Associated Press contributed to this report.