Speaking to Aljazeera on Thursday, the Palestine Liberation Organisation (PLO) chairman said there was nothing new in a speech Sharon made earlier in the day.
"It was based on a deal between Sharon and President Bush in March 2004 which tackled three main issues - withdrawal from the Gaza Strip, keeping the settlement outposts and no to a return of Palestinian refugees.
"I completely reject Sharon's speech and wonder why America, in principle, accepts decisions that previously determine the future of Palestinian issues."
Sharon is the obstacle in the way of peace."
Abbas added: "We will never concede the right of return and the keeping of illegal settlement outposts which have been rejected since 1967.
In his speech near Tel Aviv, Sharon insisted that his plan to pull out of the Gaza Strip would be implemented within the coming year and that he hoped it would be coordinated with the Palestinians.
"In 2005 we have the opportunity for an historic breakthrough in relations between us and the Palestinians," Sharon said.
"We will act with all our might to ensure that this year of opportunity will not become a year of missed opportunities."
Sharon said that the death of veteran Palestinian leader Yasir Arafat on 11 November had removed the biggest obstacle to peace in the region, and his successors were likely to tread a different path.
"Now there is a real chance that new Palestinian leaders will rise, those who will be elected, who will truly abandon the path of terror and instead will advance a strategy of reconciliation and negotiation without violence, terror and hatred," he said.
PLO cairman Mahmud Abbas, who has called for an end to the armed intifada, is the favourite to win elections due to take place on 9 January for a replacement for Arafat.
While Sharon refused to meet with Arafat, confining him to his battered headquarters in the West Bank town of Ram Allah, he hosted peace talks with Abbas last year when he was briefly Palestinian prime minister.
"The terms mentioned by Sharon were not new. They prejudge the final-status negotiations and are unacceptable"
Sharon unveiled the outlines of his so-called disengagement plan last year when he said that Israel would unilaterally withdraw from parts of the occupied territories in the absence of a partner for peace among the Palestinians.
But in a clear olive branch to Abbas, Sharon said he was ready to involve the Palestinians with the exit from Gaza and four other Jewish colonies in the northern West Bank.
"In light of the new opportunities and potential of a new Palestinian leadership, Israel will be prepared to coordinate various elements relating to our disengagement plan with the future Palestinian government - a government which is ready and able to take responsibility for the areas which we leave," the premier said.
Sharon said that his government would implement the pullout, which should see all 8000 Gaza settlers uprooted from their homes by September 2005, "with conviction and without hesitation".
He added: "This initiative is the foundation and cornerstone for the great opportunities which lie before us and it is perhaps one of the most important decisions we have made in the last few years."
But Palestinian Authority spokesman Nabil Abu Rudaina insisted Sharon's disengagement plan did not go far enough to justify raising hopes of a real breakthrough next year.
"We still demand implementation of the road map and an Israeli withdrawal from all the occupied territories so that we can create our state," he said, referring to an 18-month-old internationally drafted blueprint for Palestinian statehood in 2005.
Sharon says he is ready to deal
with a new Palestinian leadership
PLO chief Abbas has been under mounting fire within the Palestinian camp over his comments that the armed uprising has been "harmful" and that weapons should be laid down.
Al-Aqsa Martyrs' Brigades, an armed offshoot of Abbas's Fatah faction, said that "no one has the right to bring up the question of arms" as long as the Israeli occupation continued.
Islamic movement Hamas went further, claiming responsibility for a mortar attack on the southern Gaza Strip settlement of Netzer Hazani, in which Israeli military sources said 11 soldiers had been lightly wounded.