Dror Etkes should have been pleased. Six years ago, the 44-year-old Israeli peace activist asked Israel’s High Court of Justice to intervene in the case of a Jewish settlement outpost in the West Bank built on Palestinian farmland. Etkes, who spends much of his time fighting settlement expansion, thought the Migron outpost could be a test case. But when the court finally ordered Israeli authorities to evict the settlement’s 50 families last week, he couldn’t bring himself to celebrate. For one thing, the government is now building a much bigger housing project a few miles away to accommodate the ousted residents. But the larger issue is that more and more Israelis are migrating to settlements —a disturbing trend for people still hoping to see a Palestinian state established in the West Bank. Indeed, in the time it took to process the Migron case, the settler population has swelled by more than 30 percent to 360,000 (not counting those living in East Jerusalem). And with an array of government incentives and subsidies, there is little sign that the trend will subside. “It’s a bitter victory,” Etkes said, speaking over the grinding of bulldozers where the new settlement is being built.

Before its destruction, Migron was the flagship of unauthorized settlement outposts—communities erected without formal permission from the Israeli government. Its removal is undoubtedly a setback for the settler movement. But the story of Migron and dozens of other outposts that even Israel deems illegal (most of the world considers all West Bank settlements illegal) is a testament to the vast influence the settlers wield in Israel and their ability to consistently outmaneuver their opponents. Over the past decade, Israeli governments have made repeated promises to dismantle the outposts, including a specific pledge to the United States as part of the 2003 peace plan known as the Roadmap. But most are now likely to get retroactive approval and grow into full-fledged settlements, making it harder and harder to imagine an Israeli-Palestinian peace agreement. “The objective [of the settlers] was to prevent the establishment of an Arab country between Jordan and the Mediterranean Sea,” wrote Nahum Barnea, one of Israel’s most respected columnists, in the daily newspaper Yedioth Ahronoth last month. “It is safe to say that the objective has been achieved.”

The saga of Migron began, improbably, with a cellphone tower some 11 years ago, early in the second intifada. Palestinians were ambushing Israelis in the West Bank, and settlers complained that they were losing reception at a certain bend in the road south of Ramallah. Worried that if an attack ensued, victims wouldn’t be able to call for help, Israeli authorities placed a cell tower on a hill high above the bend. The tower required a guard—Palestinians were also vandalizing Israeli property—and the guard needed a trailer. By 2002 settlers had towed several more trailers to the hilltop and called the place Migron, the name of the biblical town where King Saul camped out before attacking the Philistines.

The new squatters at Migron never received permission from the Israeli government to build a settlement. But that wasn’t unusual. By 2003 scores of unauthorized outposts dotted the West Bank—part of a right-wing backlash against Israeli governments, which while encouraging growth within settlements, had promised the U.S. not to establish new ones. Yet Migron was different. The land settlers seized there (and at a few other outposts) had specific Palestinian owners—in this case, residents of the nearby villages Burka and Deir Dibwan. Israeli courts going back to 1967 had given their approval for settlements to be built on public land in the West Bank— territory to which no one held a deed. But they had struck down attempts to confiscate privately held land for the purpose of settlements. The distinction made the squatters at Migron lawbreakers twice over.

Itai Harel, a 38-year-old social worker, was among Migron’s first residents. He not only built a home in the settlement, but a horse stable where he teaches troubled and disabled kids youths to ride and care for the animals. Harel refused to speak to reporters who visited the hilltop last week, a rocky plateau with stunning vistas in every direction. The settlers were busy packing their belongings and dismantling light fixtures, before demolition crews arrived. But Harel’s father, Israel, did talk to Newsweek, scoffing at the idea that residents could establish their community without at least implicit support from the government. “Who installed the electricity, the water, the roads, the security?” said Harel, who helped found the settler movement. “They got approval from government offices for all these things.”