Hundreds of Palestinian boy and girl scouts marched through Manger Square in Bethlehem to celebrate Christmas. They passed the Church of the Nativity, where tradition says Jesus Christ was born. Security was tight -- paramilitary policemen armed with assault rifles stood guard on rooftops and on the cobblestone streets below.

Bethlehem wasdecked outfor the holiday. All the trees were lit up with red, white and yellow lights, and stars and bells illuminated the buildings. Ironically, money for the decorations came from the ruling Islamic militant group Hamas.

Despite the marches and decorations, an atmosphere of gloom hung over Bethlehem. Pilgrims who used to come in droves stayed away because of the war in Lebanon a few months ago and the recent fighting between Palestinian factions.

That is bad news for Palestinian residents who depend on tourism. Mary Jakaman owns a shop in Manger Square packed with olive wood souvenirs. She told VOA there are few customers. "It's not good, you know, because of the situation here, the tourists are afraid to come here," she said.

Still the few pilgrims who came were glad they did. David Bogenrief is from the U.S. state of Iowa. "It's joyful being here. We come to celebrate the birth of Jesus, to see all the people, to sing songs and just praise God and give him the glory. It's good to be here," he said.

But it was not easy to get here. Pilgrims arriving from nearby Jerusalem have to cross Israel's massive separation barrier which has become the de-facto border. Israel says the barrier was constructed to keep suicide bombers out, but Palestinians say Bethlehem has been changed from the city of peace into a big prison.