Palestinian Prime Minister Salam Fayyad submitted his resignation on Saturday in a move that could help usher in a power-sharing deal between Western-backed President Mahmoud Abbas and his rivals in the militant group Hamas.

Fayyad's resignation was meant to be a goodwill gesture toward the militant group. However Hamas officials dismissed his resignation, arguing his appointment has been unconstitutional.

Abbas appointed Fayyad as Prime Minister after the militant group seized power of the Gaza Strip in June 2007. The Hamas takeover effectively created two separate Palestinian administrations: an internationally backed government in the West Bank led by Abbas and technocrat Fayyad, and a blockaded government in the coastal patch of Gaza run by Hamas.

Fayyad said in a statement on Saturday that he was hoping to pave the way for a unity government.

"This step comes in the efforts to form a national conciliation government," Fayyad said.

He said his resignation would take effect after the formation of a Palestinian unity government, but no later than the end of March. The announcement came before the resumption of power-sharing talks on Tuesday between Abbas' party, Fatah and officials from Hamas, expected to take place in Cairo.

The rivals held an initial round of reconciliation talks in late February, agreeing to form separate committees to deal with grievances between the two sides, and to form a caretaker government to usher in new presidential and legislative elections.

But in Gaza, Hamas dismissed Fayyad's decision.

Spokesman Fawzi Barhoum said Fayyad's government was unconstitutional.

"This government did not work for the sake of the Palestinians, it worked for its own agenda. This end was expected for a government that was illegal and unconstitutional," Barhoum said.