The exiled political leader of Hamas has said his movement will work with Palestinian leader Mahmoud Abbas, after it took control of Gaza by force.
Hamas fighters vanquished Fatah rivals after days of clashes
Syria-based Khaled Meshaal said Mr Abbas remained the "legitimate" president, a day after Hamas fighters routed Mr Abbas' Fatah faction.
But Hamas has declared illegal Mr Abbas' replacement of its Prime Minister Ismail Haniya.
The international community has pledged to give Mr Abbas its full support.
Mr Abbas, who is in the West Bank, named former Finance Minister Salam Fayyad as his new prime minister after dissolving the Hamas-led national unity government.
A former World Bank executive, Mr Fayyad is a well-respected figure internationally.
In recent months, foreign governments have chosen to deal with him directly as a means of bypassing Hamas.
The group of Middle East mediators known as the Quartet - the US, UN, EU and Russia - threw their weight behind Mr Abbas on Friday, pledging their "full support" for the beleaguered Palestinian Authority president.
Western nations have boycotted Hamas, considered a terrorist organisation by the US and EU, since it won elections in January 2006.
Speaking in Damascus, Mr Meshaal said Mr Abbas "has legitimacy... he is an elected president, and we will co-operate with him for the sake of national interest".
But Mr Haniya said he was still the legitimate prime minister, while Hamas said Mr Abbas had acted illegally in dismissing the government.
Born in 1952 near West Bank city of Tulkarm
Holds a PhD in economics from the University of Texas
Worked at the World Bank in Washington from 1987-1995
IMF representative to Palestine until 2001
Finance minister under the Fatah-controlled administration from 2002-2005
Credited with cracking down on official corruption
The BBC's Tim Franks in Jerusalem says Hamas may have control of Gaza and Mr Abbas may have decreed a state of emergency but still nothing feels settled. The Palestinian territories still crackle with tension and uncertainty, he says.
Calm has been returning to the Gaza Strip after a week of factional fighting which left at least 100 people dead.
Traffic is back on the streets, and people have been going back to work.
There were however outbreaks of looting of Fatah-linked buildings and the home of Fatah strongman Mohammed Dahlan was stripped bare.
Mr Abbas' seafront compound was also ransacked and his office over-run by masked Hamas gunmen.
As Hamas consolidated its grip on power, its military wing called for the immediate release of BBC journalist Alan Johnston, abducted in Gaza in March.
They said his continued detention was unacceptable and Hamas TV reported on Friday night that "practical steps" were being taken to bring about Mr Johnston's freedom.
Meanwhile, about 200 Fatah officials from Gaza have sought refuge in Egypt since Thursday.
A further 3,000 Palestinian civilians are now stranded on the Egyptian side of the Rafah crossing which is closed. Rafah provides the people of Gaza with their only point of access to the outside world.
Rule by decree
President Abbas dismissed the three-month-old unity government on Thursday and declared a state of emergency.
He has said he will rule by presidential decree until the conditions are right for early elections.
Under the Palestinian Basic Law - essentially the Palestinian constitution - the president can rule by decree for 30 days. This can be extended with the approval of the parliament.
The BBC's Matthew Price in Jerusalem says this may be an irrelevance, as Mr Abbas appears to no longer have any influence in Gaza.
Our correspondent says the West Bank and Gaza Strip will now effectively be split from one another - Gaza run by Hamas and the West Bank by Fatah.
There are also fears that violence will spread to the West Bank, where Fatah is dominant.