Pope Benedict XVI on Wednesday branded the West Bank separation fence as a symbol of "stalemate" between Israel and the Palestinians, urging both sides to break a "spiral of violence."

"Towering over us, as we gather here this afternoon, is a stark reminder of the stalemate that relations between Israelis and Palestinians seem to have reached - the wall," he said, standing by the fence at a refugee camp in Bethlehem, the birthplace of Jesus.

The Pontiff later told Palestinians that he hoped the barrier would be taken down.

"Although walls can be easily built, we all know that they do not last forever, they can be taken down," he said.

Stressing the need first to remove "the walls that we build around our hearts" and bring conflict to an end, he said: "My earnest wish for you, the people of Palestine, is that this will happen soon, and that you will at last be able to enjoy the peace, freedom and stability that have eluded you for so long."

Earlier in the day, the Pope called for a sovereign Palestinian homeland after arriving in Bethlehem at the start of a one-day visit to the West Bank.

"The Holy See supports the right of your people to a sovereign Palestinian homeland in the land of your forefathers, secure and at peace with its neighbors, within internationally recognized borders," said the Pope. He made the comments at Palestinian President Mahmoud Abbas' presidential palace in Bethlehem.

Palestinians hope the pope's visit to the West Bank, and to the birthplace of Jesus in particular, will draw attention to their plight.

The German-born pope was welcomed to Bethlehem by Abbas on the third day of a visit to the Holy Land.

Security forces closed off many city streets and hundreds of people gathered outside the Church of the Nativity, the site revered as the birthplace of Jesus, in Manger Square where the pope was holding a morning mass.

Pope Benedict told Palestinians that he was praying for an end to the Israel-led blockade of the Gaza Strip.

"Please be assured of my solidarity with you in the immense work of rebuilding which now lies ahead, and my prayers that the embargo will soon be lifted," the pontiff said.

Patriarch Fouad Twal, during a mass the pope attended in Jerusalem on Tuesday, reiterated the Palestinian people's aspirations for a "free and independent state."

The pope, on his arrival in Israel on Monday, also reaffirmed Vatican support for a Palestinian state, a concept new Prime Minister Benjamin Netanyahu has been reluctant to accept as a necessary outcome of negotiations.

Palestinians have set up a small, open-air theater beside a high concrete wall that forms part of the West Bank fence.

The pope will hold a mass at Nazareth in northern Israel, where Jesus grew up, on Thursday. The surrounding Galilee region is where most of the country's 154,000 Christians live and where he will meet Netanyahu.

He flies back to Rome on Friday.

During a special mass at the Gethsemane Church in Jerusalem on Tuesday, Benedict assured the thousands of believers present that he understood the "frustration, pain and suffering" the Israeli-Arab conflict has caused them. He also urged the relevant authorities to value and support the Christian presence in the city.

At the sunlit afternoon mass for hundreds of worshippers at the Garden of Gethsemane, beneath the Mount of Olives and the city walls, he evoked the "universal vocation" of Jerusalem as the spiritual home of Jews, Muslims and Catholics.