By Wafa Amr

RAMALLAH, West Bank, Nov 11 (Reuters) - Palestinian President Mahmoud Abbas on Sunday held out to his divided people a vision of statehood within reach, hailing a U.S.-hosted conference with Israel as a historic opportunity for peace.

In a forceful speech on the third anniversary of Yasser Arafat's death, Abbas repeated there could be no dialogue with Hamas Islamists who violently took over the Gaza Strip until what he described as the "black coup" was reversed.

Tens of thousands of flag-waving Palestinians turned out at the Muqata presidential compound in Ramallah, a West Bank city long a Fatah bastion, to remember the iconic late leader, show their support for Abbas and shout their condemnation of Hamas.

"These forces of darkness will not be able to hijack our history or close the windows to our future," Abbas said at the rally, referring to Hamas, which routed his Fatah faction in the Gaza Strip last June and opposes his peace efforts with Israel.

With the conference expected to convene in Annapolis, Maryland at the end of this month, Abbas said the Palestinians were working with Arab nations and the international community to make it a success.

"We see this conference as a historic opportunity to open a new page in the history of the Middle East based on the establishment of our independent Palestinian state with East Jerusalem as its capital," he said.

Along with statehood, Abbas said, Palestinians sought the "return of Arab land occupied in (the 1967 Middle East war) and peace for "us and the Israelis and the peoples of this region".

Preparations for the conference -- a chance for President George W. Bush's administration to turn its legacy around from the unpopular war in Iraq -- have been overshadowed by disputes over what issues to tackle.

Israel and the Palestinians have agreed on the need to revive a 2003 "road map" to peace that charts reciprocal steps towards statehood.

But both sides have balked at a U.S. proposal for overseeing implementation of the first stage, which demands the Palestinians curb militants and Israel stop building West Bank settlements and remove unauthorised settler outposts.

NATIONAL PRINCIPLES

Abbas gave no indication in his address whether progress had been made in narrowing differences with Israel.

"We reiterate to you, Abu Ammar (Arafat), and our people that we are adhering to our national principles," Abbas said.

They included, he said, a "just solution" to the issue of Palestinian refugees, the release of Palestinians prisoners held by Israel and the uprooting of Israel's West Bank barrier, settlements, outposts and military checkpoints.

Arafat, hailed by Abbas as a symbol of Palestinian unity, founded the secular Fatah in the 1960s, leading the Arab fight against Israel before signing an interim peace deal in 1993.

That agreement broke down in botched talks over a final accord. Palestinians again took up arms in 2000. Abbas enjoys broad foreign support, but his strength is in doubt given the rift with Hamas and Israel's West Bank grip.

Arafat died in a French hospital on Nov. 11, 2004 after being shunned by Israel and the United States as an obstacle to peace.

Abbas on Saturday inaugurated a mausoleum built in the Muqata over Arafat's grave. It features a mosque as well as an ornamental pool. (Writing by Jeffrey Heller in Jerusalem, Editing by Sami Aboudi)

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