Israel and the Quartet of Mideast peacemakers - the US, EU, UN and Russia - imposed sanctions against the Palestinians last year after Hamas was elected to power, labeling the Islamist group with a history of suicide bombings a terrorist group. Despite widespread economic hardship, Hamas rejected the Quartet's conditions for explicit recognition of Israel.

During Saturday's swearing-in ceremony, Prime Minister Ismail Haniyeh of Hamas said the Palestinians maintained the right to resist occupation but would also seek to widen a truce with Israel. Abbas has said the deal is the best he can get from Hamas.

In Washington, White House National Security Adviser Stephen Hadley said Haniyeh's comments were "a little troubling" and said the US would watch the new government's deeds closely. He called on the Palestinians to free an Israeli soldier captured by Hamas-allied militants last June and to halt rocket attacks out of the Gaza Strip.

Arab leaders, meanwhile, pledged support for the unity government. The Jordanian and Saudi kings expressed hope it would lead to Palestinian independence, and the Arab League Secretary-General Amr Moussa called for an end to international sanctions.

The creation of the new Palestinian coalition came ahead of a March 28 Arab summit, where Mideast leaders are hoping to build momentum for a resumption of the peace process with Israel.

In addition to their struggle for international legitimacy, the Palestinians could also crumble over ideological differences and lingering enmity between Fatah and Hamas.

Abbas on Sunday named a Gaza strongman known for leading a crackdown on Hamas militants a decade ago as his national security adviser, presidential aides said.

The appointment puts Mohammed Dahlan, a top official in Abbas' Fatah, in a sensitive position as Palestinian leaders try to reform their myriad and competing security services. Hamas still has rocky relations with Dahlan.

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