Kadoura Fares, a leader of the young activists, told reporters at the Ramallah election headquarters that they had presented their own list of candidates for the election.
Earlier, the wife of jailed uprising leader Marwan Barghouti entered election headquarters to formally present the list, signaling that Barghouti was leaving Fatah. A few minutes later, Saeb Nimr, Barghouti's campaign manager, told reporters, "We have registered an independent list under the name, 'The Future,' headed by Marwan Barghouti."
Barghouti, serving five life terms in an Israeli prison, has won West Bank primary elections conducted by Fatah, but oldtime Fatah leaders, headed by Mahmoud Abbas, tried to insert old guard figures in the list ahead of the younger leaders, setting off a rebellion.
Fatah, the party of the late leader Yasser Arafat, has ruled Palestinian politics for four decades. The "old guard" returned from exile with Arafat in the mid-1990s, while many of the young activists were in the West Bank and Gaza through the years, struggling against Israeli occupation.
In other developments:
Meanhwile, Israel has approved the construction of hundreds of new homes in West Bank settlements, a Defense Ministry official said Wednesday, confirming what would be a violation of the U.S.-backed road map peace plan.
Most of the homes will be built in settlement blocs that Prime Minister Ariel Sharon vowed to keep under any final peace agreement with the Palestinians, reports CBS News correspondent Robert Berger.
Defense Minister Shaul Mofaz approved the new settlement homes in the past week, the defense official said, speaking on condition of anonymity.
Mofaz made the decision shortly before leaving the hard-line Likud Party for Sharon's new centrist party, Kadima. The Yediot Ahronot daily said Mofaz initially approved the housing to shore up support within Likud. Trailing badly in Likud polls, Mofaz decided instead to join Kadima.
The road map peace plan aims for the establishment of an independent Palestinian state alongside Israel. In the interim, Israel is required to freeze construction in all Jewish settlements, including the largest ones that it says it wants to hold onto under a future peace deal.
However, Israel has not fulfilled this commitment, and construction has continued since the road map was approved in June 2003. The Palestinians also have failed to meet their obligation to dismantle armed militant groups.
Asked for comment, U.S. Embassy spokesman Stewart Tuttle reiterated Washington's position that Israel must "stop the settlement expansion in addition to removing illegal outposts."
Sharon left Likud, his political home for 30 years, last month to form Kadima, saying he would have more flexibility to negotiate a peace agreement on the basis of the road map.
While this would mean ceding West Bank territory to the Palestinians, Sharon also has said he intends to retain large blocs of settlements — most of them near the boundary with Israel.
The Palestinians claim all of the West Bank along with the Gaza Strip, which Israel evacuated in September, as part of a future state.
Palestinian negotiator Saeb Erekat said the new construction "undermines the vision of a two-state solution."
"This is a clear-cut violation of the road map ... and I really hope that President Bush will personally take note of that," he said.
Nearly all of the new housing approved by Mofaz lies within the blocs that Sharon wants to retain, though they also include dozens of homes in smaller communities of Bracha and Nokdim deep in the West Bank.
The other houses include 200 homes in Maaleh Adumim, Israel's largest settlement, and 40 trailers in Ariel, another large settlement deep in the West Bank, the ministry official said. In addition, Mofaz agreed to advance construction plans in Givat Zeev and Beitar Illit, two large settlements near Jerusalem, the official said.
Sharon's party is expected to win elections in March, with Likud trailing far behind in opinion polls. Critics in the Likud say Sharon is planning major concessions to the Palestinians.
A Newsweek report quoting a Sharon aide as saying the prime minister would be willing to cede 90 percent of the West Bank and part of Jerusalem sparked a new uproar Wednesday. Although Sharon's office distanced itself from the report, critics said it was evidence of his true agenda.
"I prefer to believe the things that were said in English, rather than the denials given in Hebrew," said Likud lawmaker Gidon Saar.
Sharon's allies said the aide, Kalman Gayer, was merely a pollster and spoke to Newsweek only as an individual, not on behalf of the prime minister.
Lior Horev, an adviser to Sharon, said Wednesday that the prime minister remains committed to the road map, but that any territorial compromise would have to come through negotiations. "No one is talking yet about percentages of land. We are talking only about the road map. That is the only thing on the table."
Amir Peretz, leader of the Labor Party, said the political storm was deflecting attention away from his goal of focusing on social-economic issues. Peretz, a former union leader, is considered dovish on security matters, but has focused his campaign on narrowing the gap between Israel's rich and poor.