Monday's ceremony in Beirut was led by the PLO's new representative to Lebanon, Abbas Zaki, a member of Fatah.

It was boycotted by Hamas in protest its being led by a Fatah official.

Mr Zaki is expected to seek to improve the living conditions of more than 400,000 Palestinian refugees living in often squalid refugee camps in Lebanon.

He has also been assigned by the Palestinian leader Mahmoud Abbas, to hold talks with the Lebanese authorities on the United Nations' demand for the disarmament of Palestinian militants in Lebanon.

Relations between Fatah and Hamas are currently tense, following the victory of Hamas in January's legislative elections. There have recently been violent clashes between armed members of the groups.

'Representing Palestinians'

Mr Zaki and Lebanese Foreign Minister Fawzi Salloukh cut a ribbon and raised the Palestinian flag at the PLO building in a southern suburb of Beirut.

"Today Palestine returns to Lebanon and Lebanon returns to Palestine," Mr Zaki said. "I tell my Palestinian brothers that this office represents all Palestinians."

The Hamas representative in Lebanon played down the significance of the move.

"The Palestinian representative office to be opened in Beirut represents only the PLO which does not represent all the Palestinian people," Osama Hamdan said in a statement.

In the summer of 1982, the Israeli army launched a massive military incursion into Lebanon intended to destroy Palestinian guerrilla bases near Israel's northern border.

Israeli troops reached Beirut in August. A ceasefire agreement allowed the departure of PLO fighters from Lebanon.