Israeli leaders have given the green light to a troop pullout from five West Bank cities.
They also intend to release 900 Palestinian prisoners as part of a package of trust-building measures ahead of a February 8 summit between Israeli Prime Minister Ariel Sharon and Palestinian President Mahmoud Abbas.
An Israeli cabinet member said Palestinians jailed for deadly attacks would not be included in the release.
Israel will carry out a phased military pullback from positions around five cities, starting in Jericho and finishing in Ramallah, the Palestinian political capital.
Both Israel and the Palestinians say they hope to declare a formal ceasefire at next week’s meeting.
Returning to the West Bank after a five-country tour, Abbas said he hoped the last few issues on which the two sides had not yet reached agreement would be decided before the summit in Egypt.
Meanwhile, international involvement in the peace process continues with a visit from Swiss Foreign Minister Micheline Calmy-Rey.
She met Palestinian Prime Minister Ahmed Qurie ahead of talks with Abbas and Israeli Deputy Premier Shimon Peres.