Israel declared a ceasefire in Gaza and began to pull back its forces today, as tens of thousands of exhausted Palestinians made their way back to their devastated homes.
After two years of brutal war, the families of Israel's remaining hostages in the territory were also hoping the truce - pushed by US President Donald Trump - would hold.
The Israeli military said its troops had ceased fire at noon local time "in preparation for the ceasefire agreement and the return of hostages".
Three hours later, the US Pentagon confirmed Israel had completed the first phase of a pullback laid out in Trump's peace plan. Israeli forces still hold around 53 percent of the Palestinian territory.
The withdrawal set the clock running on a 72-hour deadline for Hamas to release the remaining hostages held in Gaza.
Israel, meanwhile, published the list of the 250 Palestinian prisoners it plans to release -- along with 1,700 Gazans detained since Hamas triggered the latest conflict with its attack on Israel on October 7, 2023.
As the ceasefire began, long columns of Palestinians, exhausted by two years of intense bombardment and what the UN has warned were famine conditions, began a trek from the southern city of Khan Yunis towards their shattered homes further north.
As thousands of Palestinians began their journeys home, Hamas, Islamic Jihad and the Popular Front for the Liberation of Palestine (PFLP) said in a joint statement that they had achieved "a setback for (Israel's) goals of displacement and uprooting".
"The negotiation process and the mechanism for implementing the agreement still require high national vigilance and close monitoring around the clock to ensure the success of this stage," the groups said.
"We will continue to work responsibly with the mediators to ensure that the occupation is bound to protect the rights of our people and end their suffering," they added.
Gaza's civil defence agency confirmed that Israeli troops and armoured vehicles were pulling back from forward positions in both Gaza City and Khan Yunis.
But Israel warned some areas were still off-limits and that Palestinians should steer clear of its forces while they were "adjusting operational positions in the Gaza Strip".
Bassal, the civil defence spokesman, said that around 200,000 Palestinians had returned to the north since the ceasefire took effect.
"We're going back to our areas, full of wounds and sorrow, but we thank God for this situation," 32-year-old Ameer Abu Iyadeh told AFP in Khan Yunis.
"I just pray (my home) hasn't been destroyed... We only hope the war will end for good, so we'll never have to flee again," said Mohammed Mortaja, 39, as he headed to his home in Gaza City.
Watch: Displaced Gazans head north after ceasefire comes into effect
Before dawn this morning, Israeli Prime Minister Benjamin Netanyahu's office said the government had approved a framework of the hostage-release deal.
"Citizens of Israel, two years ago, the Simhat Torah holiday became a day of national mourning," Mr Netanyahu said, referring to a Jewish festival that begins at nightfall on Monday.
"This Simhat Torah, with God's help, will be a day of national joy, celebrating the return of all our brothers and sisters held hostage," he said.
The family of Alon Ohel, who is among the 20 living hostages due to be released, said they were "overwhelmed with emotion" and eagerly awaiting his return.
"With tears of joy, we received the news that an agreement has been reached," the family said.
Israelis and Palestinians alike rejoiced after the deal was announced, to end two years of war in which over 67,000 Palestinians have been killed, and to return the last hostages seized by Hamas in the deadly attack that provoked it.
The exiled Gaza chief of Hamas, Khalil Al-Hayya, said he had received guarantees from the United States and other mediators that the war was over.
During the Hamas-led attack on Israeli communities and a music festival on 7 October 2023, fighters killed 1,200 people and captured 251 hostages.
Twenty hostages are still believed to be alive in Gaza, while 26 are presumed dead and the fate of two is unknown. Hamas has indicated that recovering the bodies of the dead may take longer than releasing those who are alive.
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The accord, if fully implemented, would bring the two sides closer than any previous effort to halt the war.
Much could still go wrong. The sides have yet to publish the list of Palestinian prisoners to be released in exchange for Israeli hostages. Hamas is seeking freedom for some of the most prominent Palestinian convicts held in Israeli jails.
Further steps in Mr Trump's 20-point plan have yet to be agreed. Those include how the demolished Gaza region is to be ruled when fighting ends, and the ultimate fate of Hamas, which has rejected Israel's demands it disarm.
The Hamas-run interior ministry said it would deploy security forces in areas where the Israeli army withdrew. It was not clear whether armed militants would return to the streets in significant numbers, a move Israel would see as a provocation.
Mr Trump said he would head to the region on Sunday, possibly to attend a signing ceremony in Egypt, and Israeli police said they were preparing for a visit by him on Monday.