By Tom Perry
RAMALLAH (Reuters) - Palestinians packed the streets of West Bank cities on Friday to support their leaders' U.N. bid for statehood, cheering President Mahmoud Abbas as he made the biggest speech of his life.
The largest crowd seen in Ramallah since the funeral of Yasser Arafat in 2004 waved Palestinian flags and watched Abbas address the U.N. General Assembly in New York on giant screens. Many said the speech made them proud.
"We have come to take part with our people in asking for our rights," said Mohammed Hamidat, 40, who had brought his wife and four children to watch events unfold.
"With the current closed horizons, it's the only thing we can do, even if the result is failure. It's been years since we have seen anything new: this is a first step."
His caution was typical of many Palestinians who are wary of the strong opposition to their U.N. statehood drive -- not only from Israel but also from its main ally, the United States, who say direct negotiations are the only way to peace.
President Barack Obama's administration has said it will veto the request for membership for the state of Palestine on land occupied by Israel in the 1967 Middle East war.
Despite the prospect of failure, Palestinians who turned out on Friday welcomed the step as a change of approach 20 years after the start of peace talks that have failed to deliver their independence.
Abbas's central role in the failed peace process has dented his credibility among many Palestinians, undermining a leader who has shown little charisma and committed political blunders.
But his speech to the General Assembly, which detailed the Palestinians' grievances against Israel, was widely admired, even by some of his critics at home.
Invoking the Arab uprisings that are reshaping the Middle East, Abbas said "the time of the Palestinian spring is here."
"There's great pride. We are behind the president. Obama spoke about freedom in the Arab world but forgot that the Palestinian people are under occupation," said Tawfiq Nimr, 63.
Loud cheers, whistles and applause erupted as Abbas handed the formal Palestinian statehood application to U.N. Secretary General Ban Ki-moon and waved it before the General Assembly.
"He was strong -- the first Arab leader to challenge Obama. This is a historic moment in his life," said Badr Abdel Razeq, 35, who also brought his three children to witness the moment.
In the West Bank city of Hebron, Palestinians who had gathered for Abbas's speech threw shoes at the giant screen when Israeli Prime Minister Benjamin Netanyahu began his address.
There was no sign of organized Palestinian violence in the West Bank -- a scenario raised by some Israelis who were worried that Israel's opposition to the biggest Palestinian diplomatic initiative in years could trigger clashes with occupation security forces.
But one Palestinian man died after being shot by Israeli troops who intervened in a clash between villagers and Jewish settlers south of the West Bank city of Nablus.
Abbas noted the latest death in his speech, raising Jewish settler militancy as one of the threats to peace.
Israel had increased its security alert level ahead of the U.N. speech, beefing up army and police deployments.
Jewish settlers dismissed Abbas's speech ahead of the event and said it would make no difference to their determination to remain on land they consider their birthright and refer to as Judea and Samaria.
"We don't care what they're up to at the U.N., we have the bible, which says the land of Israel belongs to the Jewish people," said activist Meir Bartler, 25, on Thursday.
Avraham Binyamin, spokesman for Yitzhar settlement, near Nablus, said: "The real battlefield is not at the U.N., it's here on the ground and one hopes the government and security forces will understand, just as the Arabs and settlers have, that any talk of compromise is destined to fail."
The mood among the Palestinian leadership in the Gaza Strip, ruled by Islamists, contrasted starkly with the West Bank celebrations.
Ismail Haniyeh, leader of the Hamas movement that governs the enclave and refuses to recognize Israel, said Palestinians should not beg for a state. Liberation of Palestinian land should come first, he said.
Without a guaranteed "right of return" to land lost in the 1948 war that led to the creation of the Jewish state, "what is happening at the United Nations harms the dignity of our Palestinian people," Haniyeh said.
After the speech, Hamas criticized Abbas for, among other things, reiterating his commitment to negotiations.
The outcome and potential side-effects of Abbas's statehood bid are far from clear. "At the moment, it's a state on paper. We are still occupied," said Raymond Bosheh, 50.
"I am with the move, but the consequences scare me," he said, noting Palestinian dependence on American aid and on access to trade, which is controlled by Israel.
"The economy could play a big role. Many people have nothing. We are living on aid. The economy is not based on anything solid," he said.
"Everybody takes pride in the idea of having a state, but how can you live in it when you have to pass through three checkpoints to get to Bethlehem?"
(Additional reporting by Nidal al-Mughrabi in Gaza; Writing by Tom Perry and Douglas Hamilton; Editing by Robert Woodward)