Few details have been released about the location, timing or agenda of the US-brokered talks as Israel released a brief video showing the chief negotiators - Yitzhak Molcho and Tzipi Livni of Israel and Saeb Erekat of the Palestinians - shaking hands in an undisclosed location.
There were extremely low expectations on both the sides over the outcome of the fragile peace talks as Palestinian fears that Israeli announcements of settlement plans could torpedo the talks.
Israel today released the Palestinian prisoners with "blood on their hands" after decades of incarceration in prisons as a goodwill gesture to Palestinian Authority President Mahmoud Abbas to bolster his position among Palestinians.
But the move coming in the wake of an Israeli announcement regarding strengthening of Jewish settlements failed to impress the common Palestinians.
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A close aide to Abbas, Yasser Abed Rabbo warned Israel's attempts to build new housing units could lead to a quick collapse of peace talks.
Israeli politicians gave a very guarded response on the initiative but hardliners in the government openly expressed pessimism on the future of the talks.
"We set ourselves the goal of nine months in which we will try to reach something with the Palestinians," Defence Minister Moshe Ya'alon said, adding, "We've been trying for 20 years since Oslo, and for over 120 years of the conflict."
"The skepticism in the tone of my remarks is apparent, but we've decided to give it a chance," he further added.
"We won't have a lot more chances to solve this conflict," he told Israel Army radio.
However, hardliner Deputy Defence Minister Danny Danon from Prime Minister Benjamin Netanyahu's ruling Likud party said Israelis would not accept a peace proposal made by the prime minister's predecessor Ehud Olmert.
"Such an agreement will not win support, not just from me, but also from the Likud and, I think, most of the nation," Danon said.