JERUSALEM - Israeli forces pulled out of the Palestinian town of Beit Jala before daybreak, witnesses said, hours after the Jewish state agreed to end its occupation if calm was restored.
The withdrawal, arranged with U.S. and European help, began two days after Israeli tanks and troops occupied the village following heavy exchanges of fire between Palestinian gunmen in the town and the nearby Jewish neighborhood of Gilo, a Jerusalem suburb.
Witnesses said Israeli tanks and armored personnel carriers headed out of Beit Jala, after gunfire stopped around midnight, five hours before the withdrawal began. Israeli radio reported that tanks and armored vehicles would remain near the town to ensure gunfire would not resume.
The pullout came after a late-night meeting of top Israeli Cabinet ministers in Jerusalem, including Prime Minister Ariel Sharon, Defense Minister Shimon Peres and Defense Minister Benjamin Ben-Eliezer.
Secretary of State Colin L. Powell talked yesterday with leaders on both sides to defuse the crisis. He called Palestinian leader Yasser Arafat yesterday to assure him that the Bush administration was pressing Israel to withdraw from Beit Jala, State Department officials said. Powell later called Peres.
Yesterday, Peres had worked to stop the fighting between Palestinian gunmen and Israeli forces and to pull Israeli forces out of the town. He and Arafat talked several times by phone.
But renewed violence yesterday had dashed Palestinian hopes that the Israeli army would quickly pull out of Beit Jala, which it entered early Tuesday with tanks to stop militants from shooting across a valley at Gilo.
But the Israeli forces were unable to stop the gunfire. Mortar fire resumed Tuesday night.
At 2 p.m. yesterday, the guns fell silent. Peres, after talking with Arafat and U.S. officials, announced a truce. The Palestinians, Peres said, had agreed to stop shooting. "Jerusalem will be safe," said Peres, who had opposed Sharon's decision to occupy Beit Jala. "I hope this will work out and we can stop the fighting. If not, the army will stay there to protect Jerusalem."
Four hours later, the fighting resumed. Firing at Gilo began anew, and then Beit Jala's central square erupted, with masked militiamen firing at Israeli soldiers and tanks. Heavy exchanges of gunfire were reported near a hospital.
Witnesses said Israeli soldiers were shooting from church towers and that Palestinians were throwing pipe bombs at tanks. Many Beit Jala residents have been pinned in their homes for two days, some without phone service and most with little food and intermittent power.
One Palestinian has been killed and about two dozen wounded.
At least 30 children remained huddled in the basement of a Lutheran boys school and orphanage, which Israeli soldiers took over early Tuesday. The Israeli army had denied that it took over the church building or shot from its roof or top floor. But scattered on the floor were leftover army rations of corned beef and hundreds of spent shell casings.
Last night, 10 Israeli tanks were seen moving south toward Bethlehem, which adjoins Beit Jala. Army spokesmen declined to comment on the mission.
Sharon met with top Cabinet members last night to discuss the situation, but made no comment afterward. State radio reported that the army had been told to prepare for both a protracted stay in Beit Jala and a quick pullout.
Sharon told a television interviewer yesterday that he suspects that Arafat wants to prolong the fighting to tempt Israeli forces to enter Bethlehem, to incite opposition among Christians.
"We won't go into Bethlehem, but we won't suffer shooting on Jerusalem either," Sharon said.
Gilo residents have complained that the Israeli government has done little to help. They were pleased when the soldiers entered Beit Jala but disappointed when even the presence of tanks on Beit Jala's Virgin Mary Street could not stop the shooting.
In other violence yesterday, three Palestinians and an Israeli were killed in separate shootings. Among the dead were a Palestinian gunman, a Palestinian motorist apparently shot by Jewish extremists and an Israeli truck driver killed in a Palestinian ambush.
The Associated Press contributed to this article.