The opening ceremony on Tuesday of a five-storey block of flats in Hebron come as thousands of Israelis attended an annual festival to mark the Jewish Passover holiday in the centre of the southern city.
Israeli Parliament Speaker Reuven Rivlin said the opening of the new apartments on a hill known as Tel Rumaida should be an inspiration to settlers who will be forced to withdraw from Gaza under a plan drawn up by Israeli Prime Minister Ariel Sharon.
"Blessed be the Hebron heroes," Rivlin told crowds who had gathered for the ceremony. "Thank God that He has brought us back to our land and allowed us to build here despite the opposition.
"This new house should be a symbol to all who live in Eretz Israel," he added.
Israeli troop protection
Rivlin has been one of the leading critics of Sharon's plan to evacuate all 8000 settlers living in Gaza.
Hundreds of Israeli soldiers
protect a handful of settlers
Sharon, however, appears to have no plans to evacuate the 600 settlers who currently live in Hebron, telling parliament earlier this month that their presence serves as "a strategic Jewish asset".
The 600 settlers, are permanently protected by hundreds of Israeli soldiers.
Hebron is home to the Tomb of the Patriarchs, also known to Muslims as the Prophet Ibrahim (Abraham) mosque, and is holy to both Jews and Muslims.
It is the site where a Jewish extremist killed 29 Palestinian worshippers during dawn prayers 11 years ago.
Noam Arnon, one of the leaders of the Hebron settlers, said recent excavation work had unearthed evidence of Jewish heritage in Hebron dating back thousands of year.
"The fact that we find our people's past here is a message to the people of Gush Katif (the main settlement bloc in Gaza) to keep their land," he said.
Support for the Gaza settlers was a constant theme in the festival as Israelis, who are usually wary of venturing into the city, took advantage of the massive security presence to pray at the Tomb of the Patriarchs.
Another common thread was resentment towards Sharon, who for years was seen as the settlers' biggest champion.
Rabbi Moshe Levinger, who was one of the first settlers to live in Hebron, led chants proclaiming that "Sharon must go" at the inauguration ceremony for the apartment block which has been funded with the help of pro-settler groups abroad.