"We are seeking a national unity in Palestine and we stand against the events that we have witnessed in the last days," Moussa said after the six hour meeting in the Egyptian capital.
He said there must be an "immediate and full halt" to the violence.
Moussa said that Arab countries want to "serve the Palestinian cause, and not one faction against another".
"If you ask me Fatah and Hamas are the same: both seek power and both want to obtain it through violence"
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Egypt's state MENA news agency quoted Prince Saud al-Faisal, Saudi Arabia's foreign minister, as asking the Arab League in dismay whether Palestinians had forgotten a commitment made in Mecca earlier this year to "unite and never to fight".
"Today the Palestinians have come close to putting by themselves the last nail in the coffin of the Palestinian cause," he said.
"The Palestinian leaderships must now issue an order, not just to stop the fighting immediately but also to outlaw fighting, and to return to dialogue."
The Arab League also backed Abbas's decision to apppoint Salam Fayyad, the World Bank economist turned Palestinian finance minister, as prime minister, saying that the "legitimacy of his leadership" must be respected.
Jordan also underlined its backing for Abbas' government.
The government rejects "any dissent or defiance to the legitimate authority" and stressed "the necessity to protect the Palestinian National Authority and its President Mahmoud Abbas", Nasser Judeh, the spokesman, said in a statement carried by the official Petra news agency.
Jordan's King Abdullah called Abbas to express sadness for the situation in Gaza and called for an immediate end to the infighting, Petra reported.
The Arab League will now set up a fact-finding committee to look into the recent events in Gaza and report back to the Arab foreign ministers within a month.