CAIRO – Rival Palestinian factions Fatah and Hamas signed a landmark reconciliation pact on Wednesday, ending a four-year rift that had divided the territory envisioned for a future Palestinian state. The deal plunged Israeli-Palestinian peacemaking deeper into uncertainty as Prime Minister Benjamin Netanyahu called it a “mortal blow to peace.”

The agreement, which followed years of bitter acrimony between the two Palestinian movements, was made possible in large measure by the political changes sweeping the Arab world and the deadlock in U.S.-brokered peace talks with Israel.

A unity government foreseen by the accord would also allow the Palestinians to speak with a single voice if they go ahead with plans to ask the United Nations to recognize Palestine as a state during the annual General Assembly session in September.

With Wednesday’s signing, Palestinian President Mahmoud Abbas, whose Palestinian Authority governs the West Bank, joined forces with Khaled Mashaal, the Syrian-based head of Hamas, which rejects Israel’s existence and is backed by Iran.

The alliance set off ecstatic celebrations in the Palestinian territories — and warnings from both the Obama administration and international mediator Tony Blair that the new Palestinian government must recognize Israel or risk international isolation.

Abbas brushed off the criticism and instead used the occasion to deliver a scathing attack on Israel, saying “We reject blackmail and it is no longer possible for us to accept the (Israeli) occupation of Palestinian land.”

Both Palestinian leaders emphasized a united Palestinian direction, with Mashaal declaring the pact means the Palestinians will have “one leadership, … one decision.”

“The common national goal is to establish a Palestinian state, independent with sovereignty on the West Bank and Gaza Strip with Jerusalem as the capital, without settlements, without giving up a single inch of it and with the right of return” of Palestinian refugees, the Hamas leader said.

Netanyahu denounced the new Palestinian alliance as “a mortal blow to peace and a big prize for terrorism.”

“Those of our neighbors that seek the destruction of Israel and use terrorism are not partners to peace,” he said.

The Palestinians have been torn between rival governments since a previous unity arrangement collapsed into civil war in June 2007. In five days of fighting, Hamas overran the Gaza Strip, leaving Abbas’ Palestinian Authority in charge of the West Bank. Reconciliation is essential for Palestinian dreams to establish a state in the two areas.

Wednesday’s pact provides for the creation of a joint Palestinian caretaker government ahead of national elections next year.

But it leaves key issues unresolved, such as who will lead the government or control the competing Palestinian security forces, and makes no mention of relations with Israel.

In his speech, Abbas rejected Israel’s opposition to the pact, saying the reconciliation with Hamas was an internal Palestinian affair.

“They are our brothers and family. We may differ, and we often do, but we still arrive at a minimum level of understanding,” he said.