The move, coming after a long line of failed efforts to reconcile after seven years of internal bickering, envisions a unity government within five weeks and national elections six months later.
“This is the good news we tell our people: the era of division is over,” Hamas prime minister Ismail Haniyeh said to loud applause at a Palestinian press conference also attended by representatives of the PLO.
Israel said after the announcement that Abbas had chosen Hamas over peace, and cancelled a session of US-brokered talks with the Palestinians that had been scheduled for last night in Jerusalem.
Prime minister Benjamin Netanyahu said in a statement released by his office that Abbas “chose Hamas and not peace. Whoever chooses Hamas does not want peace”.
Israeli Channel 2 TV said Netanyahu would convene an emergency session of his security cabinet today to discuss his response.
Along with the United States and the European Union, Israel views Hamas as a terrorist organisation, and says Abbas’s efforts to unify with the group show he is not serious about extending the troubled negotiations.
The talks, aimed at ending its decades-old conflict with the Palestinians and establishing a Palestinian state in the West Bank and Gaza, are scheduled to end on April 29.
Palestinians have long hoped for a healing of the political rift between the PLO and Hamas, which won a Palestinian election in 2006 and seized control of the Gaza Strip from forces loyal to Western-backed Abbas in 2007.
Since 2011, Hamas and Fatah have failed to implement an Egyptian-brokered unity deal.
Egypt’s foreign minister Nabil Fahmy welcomed the deal, saying in a statement he hoped it would “support the Palestinian position in the peace talks”.
Qatari foreign minister Khalid bin Mohamed al-Attiyah congratulated the Hamas prime minister.
The approval of the two influential Arab states, which have been at loggerheads over the role of the Muslim Brotherhood of which Hamas is an offshoot, implied the agreement had backing from the region as a whole.
The deal could give Abbas a measure of sovereignty in Gaza and help Hamas, hemmed in by an Israeli-Egyptian blockade, become less isolated.
Minutes after the announcement, Israel launched an air strike on northern Gaza, wounding 12 people, including several small children, local medical officials said.