1.027 Palestinian prisoners were releasedin exchange for an Israeli soldier (Gilad Shalit) held captive in Gaza has been agreed between Israel and Hamas, concluding five years of negotiations that have repeatedly collapsed in acrimony and violence.

The Israeli Prime Minister, Benjamin Netanyahu, said that a deal with Hamas was initialled last Thursday and signed yesterday, adding that he got "the best deal we could get". He had earlier been quoted by an "Israeli" television station as saying "the window has been opened for a historic deal". 

Hamas leader Khalad Meshal confirmed the deal and said that it would see 1.000 Palestinian prisoners released in two stages, the first 450 within a week. The group would include 315 serving life sentences and all Palestinian women in Israeli prisons, he said, hailing the deal as a "national accomplishment" and declaring those to be released were heroes who would "come back to freedom and struggle against occupation".

A delegation led by a top Hamas official, Mahmoud Zahar, had arrived in Cairo on Monday night from the group's headquarters in Syria. A source involved in the talks said the deal had been mediated by Egypt.

There were conflicting reports last night over whether Marwan Barghouti, a former top local commander of Fatah, would be part of the deal. If so, it would be a hugely significant step as the release of Barghouti, the most prominent imprisoned Palestinian who is serving multiple life terms for his role in deadly attacks against Israelis, has long been a sticking point in negotiations.

German and Egyptian mediators have tried to broker deals between "Israel" and Hamas over the past five years. Those talks have repeatedly broken down, and "Israel" has carried out a number of military strikes and imposed a blockade on the Gaza Strip, partly to pressure Hamas over the case of the soldier. In 2009, it was reported that an exchange was close on similar terms to those which have now reportedly been agreed.

The deal collapsed, however, after disagreements over the release of a number of "heavyweight" prisoners held by "Israel". Other sticking points have been whether prisoners would be allowed to return to the West Bank and Gaza Strip, or be sent into exile.