Israel has agreed to withdraw its troops from the West Bank town of Beit Jala later today under a deal brokered by the European Union, Palestinian security officials said.
"There is an agreement that the Israeli forces will withdraw from Beit Jala some time tonight, the commander of the Bethlehem area," Brigadier-General Abu Baker Thabet, said.
Another official said troops would withdraw at 8 p.m. (6 p.m. Irish time) from an area of Beit Jala seized in a military raid on Tuesday after Palestinian gunmen fired at the Jewish settlement of Gilo, regarded by Israel as a neighbourhood of Jerusalem.
Israeli officials were not immediately available to comment.
Earlier in the day Israeli Foreign Minister Mr Shimon Peres told reporters: "If the firing will really stop including the firing of mortar bombs which is a terrible thing, the army will be happy to leave the places. If not, the army will stay there to protect Jerusalem."
Firing resumed this evening after a lull of several hours, casting doubt over whether Israel would withdraw its troops from Beit Jala, a West Bank town handed over to Palestinian rule in 1995 under interim peace accords.
Palestinian officials said President Yasser Arafat had ordered his security forces to stop firing at Israeli troops who have taken up positions in parts of Beit Jala town and in Gilo.
Palestinian gunmen fired at least two mortar bombs at Gilo today, including one that hit the roof of an apartment building.
Palestinian officials said today's pullout deal was the second brokered by the EU in two days. The officials accused Israel of reneging on the first agreement under the pretext that it would not pull out under fire.
On Tuesday, the United States called for Israel to withdraw from Beit Jala.