While granting limited Palestinian self-rule in the West Bank and Gaza with Arafat as president of the Palestinian National Authority governing the area, the signatories of the Oslo accords agreed to postpone decisions on the contentious issues of Jerusalem and the construction of Jewish settlements in the occupied territories.
Arafat was making the transition to statesman, but not everyone was prepared to accept him. In 1995, New York Mayor Rudolph Giuliani booted the Palestinian leader from a concert held for heads of state and other dignitaries in town to celebrate the United Nations' 50th anniversary.
Many observers thought Arafat sabotaged his own future as a world leader -- and his people's chances of winning an independent state -- in July 2000 when he rejected a land-for-peace deal brokered by President Clinton. Clinton said Israeli Prime Minister Ehud Barak had been prepared to make extraordinary compromises, but that Arafat rebuffed him.
Seasoned Middle East watchers predicted the worst, and in September 2000, the worst seemed to have arrived when Palestinians launched a second intifada that cost thousands of lives and cleaved a seemingly unbridgeable chasm between Palestinians and Israelis. Israeli voters replaced Barak's government with Sharon, a hard-liner who was not inclined to deal with Arafat.
Even Arafat's death did not lessen Sharon's hostility toward the man. He addressed the Palestinian leader's death without mentioning his name, saying: "The latest events are likely to present a historic turning point in the Middle East."
Tensions escalated in the years that followed as Palestinian suicide bombers continued to strike deep within Israel and Sharon tried various ways to weaken Arafat's influence. The old guerrilla faced a siege at his Ramallah headquarters, efforts by U.S. and Israeli officials to sideline him through the appointment of a Palestinian prime minister, and threats to exile him. He would remain virtually confined in his Ramallah compound from December 2001 until Oct. 29, when he was taken to the French hospital for treatment of his last illness. He slipped into a coma Nov. 3 and never regained consciousness.