"I renew the pledge to continue on the path that he started and exert whatever efforts are needed to raise the flag of Palestine on the walls, the minarets and the churches of
Jerusalem," Abbas said at a rally in Arafat's old Ram Allah compound on Friday.
Abbas, Arafat's successor, led a rally attended by top officials from major factions and a handful of foreign diplomats in honour of Arafat, who died aged 75 having failed to realise his dream of a Palestinian state.
The focus of the official commemoration was Arafat's old West Bank headquarters where he spent his final years isolated and encircled by the Israeli army.
Abbas, like many in the crowd, wore the traditional Palestinian keffiyeh scarf that became Arafat's trademark. Pictures of Arafat were held by many in the crowd.
Abbas earlier laid the foundation stone for a new mausoleum complex while Quranic verses were broadcast over loudspeakers.
A museum dedicated to Arafat
will be built in Ram Allah
Many shops in West Bank cities stayed closed, with portraits of Arafat adorning their shutters. Smaller ceremonies were held in Bethlehem and Hebron. In the Gaza Strip, a low-key memorial gathering was held on Thursday night.
Officials laid the cornerstone of a museum that will be dedicated to Arafat in his compound, and will display some of his personal effects.
Arafat, a former guerrilla leader who won a Nobel Peace Prize and the deep admiration of his people only to sink into renewed conflict with Israel, left a complicated legacy.
His death, after years of being shunned by the United States and Israel, who considered him an obstacle to peace, stirred hope for a revival of peacemaking for the first time in years.
Abbas, elected in January on a platform of non-violence, forged a ceasefire agreement that smoothed the way for Israel's withdrawal from the Gaza Strip after 38 years of occupation.
But flare-ups of fighting have dampened immediate prospects for any real breakthrough towards peace.
While putting the onus on Israel for its continued grip on the West Bank, Abbas called on fighters to adhere to the truce and warned that violations "will not be tolerated".
In a sign of continuing tensions, Israeli gunners shelled an open area in north Gaza on Friday after fighters fired a rocket into southern Israel. No damage or casualties were reported.
Abbas led a rally attended by
officials from the major factions
Though lawlessness has risen in the Palestinian territories in recent months, Abbas, 70, has avoided the collapse into anarchy that many had feared.
But he continues to struggle with the fallout from Arafat's long, autocratic rule and his corruption-ridden administration.
Israeli Prime Minister Ariel Sharon, in response to recent Palestinian attacks that drew Israeli missile strikes in Gaza, has ruled out talks until Abbas reins in and disarms resistance factions.
Israeli Foreign Ministry spokesman Mark Regev said Palestinians now had a chance to escape from a "situation of corruption and terror" that he blamed on Arafat.
"Abbas believes that terror is not the answer. He goes by the motto of 'one authority, one law, one security service'," Regev said. "But we don't see him putting this motto into use."
Abbas is reluctant to challenge resistance groups, fearing civil war, and says Israel's continued settlement expansion in the West Bank is a major obstacle to peace.