The first movie theater to operate in this Palestinian city in two decades opened its doors in late June. Palestinian policemen standing beneath new traffic lights are checking cars for seat belt violations. One-month-old parking meters are filling with the coins of shoppers. Music stores are blasting love songs into the street, and no nationalist or Islamist scold is forcing them to stop.

“You don’t appreciate the value of law and order until you lose it,” Rashid al-Sakhel, the owner of a carpet store, said as he stood in his doorway surveying the small wonder of bustling streets on a sunny morning. “For the past eight years, a 10-year-old boy could order a strike and we would all close. Now nobody can threaten us.”

For the first time since the second Palestinian uprising broke out in late 2000, leading to terrorist bombings and fierce Israeli countermeasures, a sense of personal security and economic potential is spreading across the West Bank as the Palestinian Authority’s security forces enter their second year of consolidating order.

The International Monetary Fund is about to issue its first upbeat report in years for the West Bank, forecasting a 7 percent growth rate for 2009. Car sales in 2008 were double those of 2007. Construction on the first new Palestinian town in decades, for 40,000, will begin early next year north of Ramallah. In Jenin, a seven-story store called Herbawi Home Furnishings has opened, containing the latest espresso machines. Two weeks ago, the Israeli military shut its obtrusive nine-year-old checkpoint at the entrance to this city, part of a series of reductions in security measures.

Whether all this can last and lead to the consolidation of political power for the Fatah-dominated Palestinian Authority based in Ramallah, as the Obama administration hopes, remains unclear. But a recent opinion poll in the West Bank and Gaza by the Jerusalem Media and Communications Center, a Palestinian news agency, found that Fatah was seen as far more trustworthy than Hamas — 35 percent versus 19 percent — a significant shift from the organization’s poll in January, when Hamas appeared to be at least as trustworthy.

“Two years ago I couldn’t have even gone to Nablus,” said Tony Blair, the former British prime minister who serves as international envoy to the Palestinians, after a smooth visit this week. “Security is greatly improved, and the economy is doing much better. Now we need to move to the next stage: politics.”

The aim of American and European policy is to stitch Palestinian politics back together by strengthening the Palestinian Authority under the presidency of Mahmoud Abbas, which favors a two-state solution with Israel, while weakening the Islamists of Hamas, who rule in Gaza. Fatah says it will hold its first general congress in 20 years in early August to build on its successes, but it remains unclear if the meeting will take place.

The Israeli government of Prime Minister Benjamin Netanyahu says it shares the goal of helping Mr. Abbas, which is why it is seeking to improve West Bank economic conditions as a platform for moving to a political discussion. The Palestinians worry that the political discussion will never arrive and say the Israelis are doing far too little to ease the occupation. Still, they point with pride to the many changes in the West Bank.

Meanwhile, the Israeli-led economic siege of Gaza continues, letting in only humanitarian goods. That sets the desired contrast between the territories into sharp relief but causes enormous suffering and anger.

Asked to explain why the West Bank’s fortunes were shifting, a top Israeli general began his narrative with a chart showing 410 Israelis killed by Palestinians in 2002, and 4 in 2008.

“We destroyed the terrorist groups through three things — intelligence, the barrier and freedom of action by our men,” he said, speaking on condition of anonymity in keeping with military rules. “We sent our troops into every marketplace and every house, staying tightly focused on getting the bad guys.”

But he added that the 2006 legislative electoral victory by Hamas, followed by its violent takeover of Gaza in 2007, led Mr. Abbas to fight Hamas. Palestinian troops have been training in Jordan under American sponsorship.

There are now several thousand men trained in that way, and their skills, along with those of the European-trained police force here, have made a huge difference.

An important element in making the Palestinian force effective, American and Israeli officials say, was taking young Palestinian men out of the ancestral grips of their villages and tribal clans and training them abroad, turning them into soldiers loyal to units and commanders.

The Israeli general said that in the past year and a half, Israeli and Palestinian forces had shot at each other only twice, and in each case there was a meeting to restore trust.

Speaking of the seriousness of the Palestinians, he added, “Twice in recent months we have been amazed.” The first time was during Israel’s military invasion of Gaza when Palestinian police officers kept the West Bank calm during protests. The second was in June when the security forces clashed twice with Hamas men in the city of Qalqilya, fighting to the death.

The Israelis have pulled their forces to the outskirts of four cities, greatly reduced the number of permanent checkpoints and promised to help industry develop. They say the Palestinians now need courts, prisons and trained judges.

Mr. Blair agreed but said there was much more Israel should do, like ending the growth of settlements and taking away dirt mounds and other barriers. In addition, he said, Israel should allow greater Palestinian development in the 60 percent of the West Bank it fully controls.

Palestinian business leaders are incensed at the Israeli limitations. Paltel, which operates the only Palestinian cellphone company, says Israel will not permit it to place its towers on the land it controls. That forces Palestinian customers to pay roaming charges for many calls, and allows Israeli cellphone companies to offer lower rates.

For more than a year, Israel has promised to free a second frequency so that a competitor to Paltel can provide cellphone service, but it has not yet done so. This leaves the Palestinians skeptical.

“I fail to see any indications that Israel wants to help the Palestinian economy,” Abdel-Malik al-Jaber, vice chairman of Paltel, said.

Still, his company has invested millions in the past year in call centers and customer service because of the increased security and disposable income.

As Nader Elawy, manager of Cinema City, the new movie theater here, put it: “We now have law and order. You can really feel the change.”