Israeli forces withdrew from a West Bank town early today after the Palestinian leadership reportedly agreed to stop gunmen firing at an Israeli settlement on the outskirts of Jerusalem.
Two Israeli tanks and other armour withdrew from positions seized in Beit Jala on Tuesday in response to heavy Palestinian gunfire on Gilo, a Jewish settlement Israel regards as an integral part of Jerusalem.
The Israeli army declined immediate comment, but Israeli radio stations said the pullout was complete. Witnesses in Beit Jala said there seemed to be no Israeli military presence in the mainly Christian town near Bethlehem.
Israel's incursion into parts of Palestinian-ruled Beit Jala heightened international concern that 11 months of conflict could spiral out of control.
The European Union brokered a deal yesterday under which the Israeli forces would pull out of Beit Jala if Palestinians stopped firing at the Jewish settlement of Gilo.
But shortly after the deal was reached, Palestinian gunfire was directed at Gilo, mostly from a refugee camp near Bethlehem, casting doubt over whether the withdrawal would go ahead.
But Israeli prime minister Mr Ariel Sharon gave the go-ahead after a late-night meeting with senior cabinet ministers.