Photo gallery: Crowds throng Bethlehem for Christmas
Despite the Christmas cheer, Mideast politics loomed in the background. In order to enter Bethlehem, Twal's motorcade had to cross through the hulking concrete separation barrier that Israel built during the uprising. Israel says the barrier is needed to keep attackers from entering nearby Jerusalem, but Palestinians say the structure has stifled the town and stolen their land.
Maayah said that the barrier, along with nearby Israeli settlements and Israeli control of archaeological sites in the West Bank, has made it difficult to develop the tourism sector.
In addition, few Palestinians seem to think that the current round of peace talks will bear fruit. U.S. Secretary of State John Kerry relaunched the talks last summer, but there have been no signs of progress.
Israel carried out a series of airstrikes and other attacks Tuesday in the Gaza Strip in retaliation for the deadly shooting of an Israeli civilian who had been working along the border. The fighting, which left a 3-year-old Palestinian girl dead, was the heaviest in more than a year.
Christmas also serves as a reminder of the dwindling numbers of Christians who live in the Holy Land. Over the decades, tens of thousands of Christians have left, fleeing violence or in search of better opportunities overseas. Christians now make up a tiny percentage of the population.
Bethlehem is now only one-third Christian, with most residents Muslim. In an annual gesture, Israel permitted some 500 members of Gaza's small Christian community to leave the Hamas-ruled territory and cross through Israel to attend the celebrations in Bethlehem.
But for one night at least, residents and visitors brushed aside their troubles to celebrate the holiday.
Nick Parker, a student from Georgia Tech University, said he was enjoying the food and making friends with local residents and fellow travelers.
"It's special to be here where Jesus was born," he said. "It's a special opportunity, once in a lifetime."