The Arab League summit is now focussing on how to contain regional violence and draft political reforms urged by Washington.
Palestinian leader Yasir Arafat also appealed to the gathered Arab leaders or their representatives for international protection for his people, speaking via a satellite link-up from his battered West Bank headquarters.
The rescheduled two-day summit, delayed for eight weeks after Tunisia abruptly cancelled it amid a row over reform proposals, opened amid popular Arab rage over US military actions in Iraq and deadly Israeli military raids in the Gaza Strip.
"I proclaim here before you and the world our commitment to a peace of the brave," Arafat said from Ram Allah, where Israeli forces have kept him under virtual house arrest for two years.
Wearing his trademark black and white checkered headdress, he urged Arabs to lobby for an international force to protect his people and a revival of Palestinian negotiations with Israel based on the internationally drafted but floundering peace plan known as the roadmap.
Past appeals for an international force for the Middle East have fallen on deaf ears amid Israeli opposition.
"Voices call for getting rid of the Arab League or breaking it up as if it were the cause of all the ills of the Arab nation, which is false"
Arab League secretary-general
More than 40 Palestinians have been killed this week in Israeli operations in the Gaza Strip, despite a proposal by Prime Minister Ariel Sharon to unilaterally withdraw from the territory.
The proposal has sparked fears among Arabs that Sharon will impose a disadvantageous settlement on the Palestinians, who want a complete Israeli withdrawal from the Gaza Strip, the West Bank and east Jerusalem, occupied since the 1967 Middle East war.
As he opened the gathering at a flag-bedecked conference centre in Tunisia's seaside capital on the Mediterranean, Tunisian President Zain al-Abidin bin Ali held a minute's silence for Palestinians killed in the recent Israeli raids.
Bin Ali also denounced terrorism, vowed Arabs would pursue political and economic reform at their own pace and in harmony with tradition, and reiterated the need for the US-led occupation to ensure Iraq remains whole and recovers its sovereignty.
The leaders are expected to approve a draft enshrining these ideas on Iraq - but also denounce the abuse by US guards of prisoners at Iraq's infamous Abu Ghraib prison and demand those responsible be punished.
A senior Arab official said the summit was heading towards taking a "moderate" stand and would adopt a resolution that "condemns military operations against Palestinian civilians and Palestinian leaders, as well as operations against civilians, without discrimination".
That would be a first for an Arab summit and would underscore a desire to revive the Arab-Israeli peace process, left crippled by more than three years of violence, on the basis of trading land occupied by Israel in 1967 for peace.
Al-Qadhafi wanted to discuss a
united Palestinian-Israeli state
Critics charge that Arab governments are so weak they are at the mercy of the hardline policies of US President George Bush and his main regional ally Israel.
Al-Qadhafi, who had kept people guessing whether he would show up for the summit until the last minute, walked out during the opening speeches before announcing he was bolting the summit and renewing his call to have Libya withdraw from the 22-member Arab League.
The flamboyant Libyan leader said he disagreed with the summit agenda, without being more specific.
He hinted at his previous gripes that the League was powerless to defend the Palestinians and Iraq. He pointed out that Iraq's deposed President Saddam Hussein was in US military custody and Arafat was confined to Ram Allah.
An Arab delegate also said al-Qadhafi may have been upset by veiled criticism from Arab League chief Amr Musa.
"Voices call for getting rid of the Arab League or breaking it up as if it were the cause of all the ills of the Arab nation, which is false," Musa said in his speech.
The Arab League "is currently going through a difficult time and faces major challenges," Musa said. "Don't let it collapse."
The Arab League has been called
a 'talking shop'
Delegates say in return for trying to defuse regional tensions, Arab leaders will be given more say in a revised American document on regional reform to be presented to the 10 June summit of the Group of Eight major industrialised nations and Russia.
The Arabs insist change must come from within and reject any foreign interference. But analysts say authoritarian governments fear democratic reforms could eventually cost them their holds on power.
The United States sees Arab reforms as crucial for removing some of the frustrations it believes have led to anti-American "terror" attacks.