"After Israel refused that the martyr Abu Abbas be buried in Ram Allah we have been in touch with several Arab countries," Wasil Abu Yusuf leader of the PLF in the West Bank told AFP.
"Syria agreed ten minutes ago that his body be transferred to Damascus and buried in the martyrs' cemetery at Yarmuk.
"According to the Red Cross the transfer is expected within hours," he added.
Abu Abbas, whose given name was Muhammad Abbas, died on 10 March in US custody in Iraq, where he was captured last April.
He oversaw the hijack of the Achille Lauro cruise ship in 1985, in which a wheelchair-bound American tourist, Leon Klinghoffer, 69, was killed and thrown overboard.
A Palestinian Cabinet minister said on Saturday the United States agreed to hand over Abbas' body for burial in Ram Allah.
But a senior Israeli government official, who spoke on condition of anonymity, said on Monday Prime Minister Ariel Sharon and his Cabinet would turn down such a request.
Under a 1993 interim Israeli-Palestinian peace deal, the Palestinians must receive Israeli permission to transfer bodies for burial to the West Bank and Gaza Strip. The Israeli official said the Palestinians had not asked to bring Abu Abbas's body to the West Bank.
US officials say Abu Abbas, 56, died of natural causes, but members of his faction, the Palestine Liberation Front, have accused the United States of assassinating him.