Gaza - Israeli forces declared a ceasefire and withdrew from some positions in Gaza on Friday, as thousands of displaced Palestinians began to trek home.

The Israeli army said that its troops had ceased fire at noon "in preparation for the ceasefire agreement and the return of hostages."

Gaza's civil defense agency said Israeli troops and armored vehicles were pulling back from forward positions in both Gaza City and Khan Younis, and displaced Palestinian civilians told AFP they hoped to return home.

Thousands of civilians could be seen by AFP journalists walking along a raised route on Gaza's waterfront, as displaced Palestinians sought to return home after two years of brutal Israeli siege.

"We're going back to our areas, full of wounds and sorrow, but we thank God for this situation," 32-year-old Ameer Abu Lyadeh told AFP in Khan Younis.

"God willing, everyone will return to their areas. We're happy – even if we return to ruins with no life, at least it's our land."

Israeli Prime Minister Benjamin Netanyahu's office said that the government has approved a framework of a hostage release deal with Hamas, and the military confirmed it was "in the midst of adjusting operational positions in the Gaza Strip."

Before the ceasefire was announced, some attacks continued. An AFP video journalist filming from the border reported large plumes of smoke and dust rising above northern Gaza on Friday morning.

Gaza civil defense official Mohammed al-Mughayyir said a municipal worker had been killed by Israeli fire.

Israel had previously said all parties had signed the first phase of a ceasefire agreement at talks this week in Egypt, adding that Hamas freeing its remaining Israeli captives alive and dead would "bring the end to this war."

The agreement followed a 20-point plan announced last month by US President Donald Trump, who plans to leave on Sunday for the Middle East.

Egypt is planning an event to celebrate the conclusion of the deal, while the families of 47 hostages taken during Hamas' October 7, 2023, attack are waiting for their loved ones' return.

Despite celebrations in Israel and Gaza and a flood of congratulatory messages from world leaders, many issues remain unresolved, including Hamas' disarmament and a proposed transitional authority for Gaza led by Trump.

Senior Hamas official Osama Hamdan told Qatar-based broadcaster Al Araby that it rejects this idea.

Trump said the issue of Hamas surrendering its weapons would be addressed in the second phase of the peace plan.

"There will be disarming," he told reporters, adding there would also be "pullbacks" by Israeli forces.

Those pullbacks appeared to be underway on Friday.

"Israeli forces have withdrawn from several areas in Gaza City," said Mughayyir of the civil defense agency rescue unit.

Mughayyir said the areas Israeli troops were withdrawing from were Tel al-Hawa and Al-Shati camps in Gaza City, both of which had seen intense Israeli air and ground operations in recent weeks, and parts of the southern city of Khan Younis.

Residents of several areas of the Gaza Strip also told AFP the Israeli military appeared to have withdrawn from positions that they held on Thursday.

Long columns of Palestinians, exhausted by two years of intense bombardment and what the UN warned were famine conditions, began a trek back from Khan Younis in the south towards their shattered homes further north.

Areej Abu Saadaeh (53) was displaced early in the conflict and is now heading home between smashed piles of rubble and twisted steel, under a flat blue sky and clouds of cement dust.

"I'm happy about the truce and peace, even though I'm a mother of a son and a daughter who were killed and I grieve for them deeply. Yet, the truce also brings joy: returning to our homes," she said.