Efforts to create a Palestinian state on the West Bank of the River Jordan and Gaza on the Mediterranean coast have been frustrated by the continuing conflict with Israel and disputes over the status of diaspora Palestinians.
The war that followed Israel's declaration of independence in 1948 saw the former British mandate of Palestine partitioned between Israel, Trans-Jordan and Egypt.
Hundreds of thousands of Palestinians fled or were forced out of their native land during the war, in what they call the "Nakba" or "Catastrophe".
The demand of these refugees and their descendants to return to their former homes remains one of the most fiercely debated aspects of the dispute with Israel.
The Palestinian national movement gradually regrouped in the West Bank and Gaza, run respectively by Jordan and Egypt, and in refugee camps in neighbouring Arab states.
The Palestine Liberation Organisation (PLO) emerged as its leading umbrella group shortly before the Six-Day War of 1967, during which Israel captured the West Bank, Gaza and East Jerusalem, and conducted a protracted campaign of violence against Israel.
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The PLO under Yasser Arafat gradually won international recognition as the representative of the Palestinian people, culminating in the Oslo Accords with Israel in 1993.
These accords established a Palestinian National Authority (PNA - also referred to as the Palestinian Authority, or PA) as an interim body to run parts of Gaza and the West Bank (but not East Jerusalem) pending an agreed solution to the conflict.
The PNA functions as an agency of the PLO, which represents Palestinians at international bodies. It is led by a directly-elected president, who appoints a prime minister and government which must have the support of the elected Legislative Council.
Its civilian and security writ runs in urban areas (Area A) under the Oslo Accords, with civilian but not security control over rural areas (Area B).
The Israeli occupation of the West Bank, with its continuing settlement building and military checkpoints, and Palestinian attacks, have slowed progress towards a final agreement and led many on both sides to dispute the worth of the Accords.
Israel retains full control over bypass roads, settlements and the Jordan Valley, and makes incursions into urban areas against armed groups.
In 2005, Israel completed the withdrawal of all its troops and settlers from the Gaza Strip but it retains control of the airspace, seafront and access - including deliveries of food and other goods - apart from the crossing with Egypt.
The Islamist Hamas movement, which runs Gaza, explicitly rejects Oslo and its charter calls for Israel's "nullification".
The Fatah faction of the PLO ran the PNA until 2006, when Hamas won a majority in Legislative Council elections.
Uneasy co-existence between PNA President Mahmoud Abbas and a Hamas-led government led to violence between armed wings of Fatah and Hamas, culminating in Hamas seizing power in Gaza in June 2007 and President Abbas dismissing the government.
The two PNA areas have since been run by the separate factions - the West Bank by Fatah, and Gaza by Hamas. Egyptian-mediated efforts to bring the two factions together met with little success.
Local elections on the West Bank in October 2012 undermined Fatah's position, as it won only two-fifths of the seats contested on a turnout of 55%, with independents and Fatah dissidents making gains. Hamas boycotted the poll, and allowed no elections at all in Gaza.
In 2014 Fatah and Hamas announced a reconciliation deal and formed a unity government, in an attempt to end seven years of sometimes violent division.
The PNA made a symbolic bid for recognition at the UN as the "State of Palestine" in 2011, mainly in an effort to highlight the lack of movement in relations with Israel.
This failed to gain the required support, but UNESCO - the UN cultural and educational agency - did admit the "State of Palestine" as a member in October.
In November 2012, the UN General Assembly voted to upgrade the status of the Palestinians to that of a "non-member observer state" - a move that allows them to take part in General Assembly debates and improves their chances of joining UN agencies.
The Palestinian population of around ten or eleven million people is divided between historic Palestine and a diaspora, mainly in neighbouring Arab countries.