December 14, 1988 - Palestinian leader Yasser Arafat condemns all forms of terrorism and recognizes the state of Israel. U.S. President Ronald Reagan authorizes the U.S. to enter into a “substantive dialogue” with the Palestine Liberation Organization (PLO). Israel remains hostile to the PLO.
January–September 1993 - Secret talks between Israeli and the Palestine Liberation Organization (PLO) negotiators begin in Oslo, Norway. On September 13, Palestinian leader Yasser Arafat and Israeli Prime Minister Yitzhak Rabin sign a Declaration of Principles in Washington on the basis of the negotiations between Israeli and Palestinian teams in Oslo, Norway.
Israel recognizes the PLO and gives them limited autonomy (in the occupied territories of the West Bank and Gaza) in return for peace. The PLO in turn gives up its claims to Israel’s territory as defined by its borders before the 1967 war. The Palestinians also agree to end the Intifada and establish security in the West Bank and Gaza.