Thousands of Christian pilgrims descended on the little town of Bethlehem on Thursday to celebrate in Jesus's traditional birthplace what locals said was a Christmas of mixed blessings.
The traditional march by bagpipe-wielding boy scouts got the celebrations off under sunny skies and balmy weather, the start to a day of festivities that will also include Austrian rock groups carolling in Manger Square.
They will cap off with midnight mass in St Catherine's Church next to the Church of the Nativity, built over the spot where Mary is said to have given birth in a manger after she and Joseph could not find any room at the inn.
"This is the place where God gave us his son, so it is very special for me to be here, for me and my whole community," said Juan Cruz, 27, from Mexico.
The Christmas celebrations cap a year when tourists returned to the town in the Israeli-occupied West Bank, where tradition holds the Prince of Peace was born, in numbers unseen since the outbreak of Israeli-Palestinian violence at the turn of the millennium.
But even the festive lights strung could not dispel the pall cast by the huge wall lurking over the entrance to the town, part of Israel's controversial separation barrier built the length of the West Bank, and continued concern for the plight of the Bethlehem's dwindling Christian population.
"We are prepared to welcome Christmas with lights, decorations and joy, but this little town of love and peace, the capital of Christmas, lacks the desired peace it deserves," said Bethlehem mayor Victor Batarseh.
Buoyed by the relative calm that has reigned in the West Bank, more than 1.6 million visitors have been to Bethlehem this year, Palestinian Tourism Minister Khulud Duaibess said. Some 15,000 pilgrims were expected for the Christmas celebrations.
It marked a third consecutive year that tourists have returned to Bethlehem following the drop that accompanied the outbreak of the second Palestinian intifada or uprising in September 2000, she said. In 2008, one million tourists visited the town.
However, the tourism boom has not brought an accompanying economic surge, with most tourists whisked in for the day and using hotels and restaurants in Israel, Duaibess said.
"Only five percent of the money stays on the Palestinian side," she said.
The financial woes have been further exacerbated by the barrier that runs along three sides of the town, and is symbolised by the eight-metre (26-foot) high concrete wall that separates Bethlehem from Jerusalem and forms part of the projected 700-kilometre (440-mile) West Bank separation barrier.
Israel calls it a "security barrier" needed to stop attacks inside the Jewish state. Palestinians call it an "apartheid wall" that cuts them off from much of their land and hampers tourism, trade, and freedom of movement.
"Stop the occupation and put down the walls," said Batarseh, the mayor. "We have to put down the walls so we can live with peace and love," he said.
The Israeli military said on Thursday that it has so far issued more than 10,000 permits for Palestinian Christians to leave the West Bank and enter Israel for holiday celebrations.
Israel has allowed 300 Christians over the age of 35 out of Gaza's 2,500-strong community to leave the Hamas-run territory to travel to the West Bank for the holiday, the army said.