Hamas has criticised the plan, saying it increases Israel's control over Gaza.
 
Nour Odeh, Al Jazeera's correspondent in Gaza, said: "This is not an arrangement that any Palestinian party is happy with, including Fatah [Hamas' rival]."
 
"We heard from a senior Fatah leader today saying that this was not their choice," she said.
 
The Erez crossing is a long bus ride away from Rafah, where most of the Palestinians were waiting.
 
Alan Fisher, reporting for Al Jazeera from the Erez crossing, said: "Initially there was a plan to bring the people who've been stranded [in northern Sinai] through Kerem Shalom but Hamas reportedly said that if that happened they would shell the area ... That's why they've decided to bring the people in busses all the way north to Erez."
 
Trapped
 
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The 105 Palestinians were the first of more than 600 stranded Gazans expected to return home on Sunday and Monday.
 
Hani al-Jabour, a Palestinian embassy official, told reporters that around 627 Palestinians would be allowed to cross into Gaza through Israel under a deal agreed on Saturday.
 
He said the Palestinians were chosen on a first-come-first-serve basis and that none were wanted by Israel.
 
The Rafah crossing between Egypt and Gaza, which is jointly controlled by Egypt, Israel, the Palestinians, and overseen by European monitors, is often closed leaving Palestinians stranded, waiting to return home.
 
Many have been trapped at the crossing since June 9 after fighting broke out between Hamas and Fatah. Some have been there even longer.
 
International aid groups have repeatedly called the issue of stranded Palestinians at the crossing to be resolved.
 
The Egyptian Red Crescent estimates that roughly 5,000 Palestinians have been stranded in north Sinai since Hamas seized control of Gaza in June.
 
Palestinian officials estimate the number of stranded Gazans at between 6,000 and 7,000.
 
Both Israel and Egypt have rejected demands by Hamas to have partial control of the Rafah crossing.