Israeli and Palestinian leaders began direct peace negotiations in Washington today, and agreed to meet every two weeks to try to forge a deal within a year to end the conflict.
Israeli prime minister Benjamin Netanyahu and Palestinian president Mahmoud Abbas predicted tough talks ahead as hardliners on both sides vowed never to accept a deal.
The talks, which are being hosted by US secretary of state Hillary Clinton, come after a 20-month hiatus.
The leaders are seeking a deal within one year that will set up an independent Palestinian state side-by-side with a secure Israel.
Despite widespread scepticism about the chances of this latest attempt to bring peace to the region and the shooting of Jewish settlers by Hamas militants in the West Bank this week, Mr Netanyahu and Mr Abbas agreed to meet again on September 14th-15th. Diplomats said that meeting will take place in Egypt.
The two sides agreed to meet every two weeks thereafter, US Middle East peace envoy George Mitchell said. The agreement to continue talks marked a small step forward.
"This will not be easy," Mr Netanyahu said as talks began. "A true peace, a lasting peace, will be achieved only with mutual and painful concessions from both sides."
Mr Netanyahu said Israel was ready to go "a long way in a short time" to reach a peaceful solution to the decades-long conflict, which US president Barack Obama has said is a top priority for his administration.
Mr Abbas called on Israel to end the blockade of the Gaza Strip and stop settlement activity - a potential roadblock to any deal. About 500,000 Jewish settlers live in communities scattered all over the West Bank that have the protection of Israeli armed forces, as well as in Arab East Jerusalem.
Mr Abbas also said the Palestinians recognized the need for security, a key Israeli demand. "We want to state our commitment to follow on all our ... engagements, including security and ending incitement," Mr Abbas said.
Negotiators face deep divisions among both Israelis and Palestinians over the prospects for peace as well as the one-year timeline that Mr Obama has set.
Acknowledging the "suspicions and scepticism" that surround the talks, Mrs Clinton said the United States would be a sustained partner in the peace effort but would not impose its own solution.
"By being here today, you each have taken an important step toward freeing your peoples from the shackles of a history we cannot change and moving toward a future of peace and dignity that only you can create," Mrs Clinton said.
The negotiations were denounced by the Palestinian Islamist group Hamas, which seized control of the Gaza Strip from Mr Abbas' Fatah party in 2007 and rejects negotiation with Israel.
Hamas, which shot dead four Israeli settlers in the West Bank on Tuesday, said it would continue the attacks and ignore any deal struck at the talks.
Jewish settlers, meanwhile, vowed to launch new construction in their enclaves in the occupied West Bank, saying they could never accept a deal that curbs their right to live in what they consider Israel's biblical homeland.
Mr Obama, hosting the talks ahead of the pivotal November US congressional elections, used separate meetings with Mr Netanyahu and Mr Abbas yesterday to urge them not to let the chance for peace slip away.
The issue of settlements looms large over the peace talks. Mr Abbas has warned he will walk out unless Israel extends its self-imposed moratorium before it expires on September 26th.
Israel dismisses international findings that the Jewish settlements that have been built since the 1980s in the West Bank, on land occupied by the Israeli military since 1967, constitute a violation of international law.
Mr Netanyahu, who heads a coalition dominated by pro-settler parties, has resisted any formal extension of the partial construction freeze, meaning the fledgling negotiations will face a major challenge within weeks.
Four Israeli settlers were killed by Hamas in a shooting attack in the West Bank on Tuesday. Another two people were wounded in a similar attack by suspected Palestinian gunmen yesterday despite a crackdown by Palestinian police.
Mr Netanyahu welcomed the Palestinian president’s denunciation of the attack, but said it was important that his government find a way to stop future attacks.
"They seek to kill our people, kill our state, kill our peace. And so achieving security is a must," Mr Netanyahu said.
Mr Abbas - whose Fatah party controls the West Bank - said his fledgling security services would stay on the hunt for the perpetrators. "We will continue all our effort to take security measures in order to find the perpetrators. We consider that security is of essence, is vital (for) both of us," he said.
Jewish settlers, who have threatened to topple Netanyahu if he does not allow them to resume building, said they planned to launch new construction even before the government's freeze ends this month. They also rejected Palestinian hopes to set up their own state on the West Bank.