Cease-fire begins between Israel and Hamas

More importantly, both Israel and the U.S. engaged in negotiations with the Islamists, albeit indirectly. Both countries consider Hamas to be a terrorist group.

The biggest loser appears to be Abbas, the main political rival of Hamas, who was forced to watch the events in Gaza from the sidelines. Since losing control of Gaza, Abbas has been unable to end the bitter rift with Hamas, leaving him governing in the West Bank only. Abbas seeks an independent state that includes both territories.

The events of recent days, coupled with a four-year impasse in peace efforts with Israel, will underscore Abbas' image as an ineffective leader.

As the streets of Gaza City snarled with celebrations, chants of "God is great!" echoed from mosque speakers.

"I came out from under the fire. I want my children and I to live in safety. I don't want war," said Abdel-Nasser al-Tom, a resident of northern Gaza who had huddled for shelter in a U.N. school. "I just hope they commit to peace."

Federman reported from Jerusalem. Mohammed Daraghmeh in Cairo and Ariel David in Tel Aviv contributed to this report.