By Maayan Lubell, Nidal al-Mughrabi and Dawoud Abu Alkas
JERUSALEM/CAIRO/GAZA (Reuters) -Hamas freed four female Israeli soldiers on Saturday in exchange for 200 Palestinian prisoners, but a delay in freeing another hostage prompted Israel to block hundreds of thousands of Gazans from returning to the enclave's bombed-out north.
The four Israelis freed in the second swap of the week-old Gaza truce were led onto a podium in Gaza City amid a large crowd of Palestinians and surrounded by dozens of armed Hamas men. The hostages waved and smiled before being led off, entering Red Cross vehicles to be transported to Israeli forces.
Soon after, buses carrying released Palestinian prisoners were seen departing from the Israeli Ofer military prison in the occupied West Bank. Israel's Prison Service said all 200 had been released.
The releases on either side were greeted by cheering crowds, including Israelis gathered in Tel Aviv and Palestinians assembled in Ramallah.
But the failure of Hamas to release another hostage, a female Israeli civilian, led Israel to announce it was halting plans to let Palestinians return to northern parts of Gaza, the area worst hit in the war.
Hamas, which considers the return of Gazans to their homes to be one of the principal elements of the ceasefire, said it would free the hostage next week, and called the halt to the reopening of the north a violation of the truce.
The truce calls for Hamas to release 33 women, children, elderly, sick and wounded hostages over a six-week first phase, with Israel freeing 30 prisoners for each civilian and 50 for each soldier.
The four Israeli soldiers freed on Saturday - Karina Ariev, Daniella Gilboa, Naama Levy and Liri Albag - had all been stationed at an observation post on the edge of Gaza when Hamas fighters overran their base and abducted them during the Oct. 7, 2023 attack on Israel that precipitated the war.
Their parents clapped and cried out in joy when they saw them on screen, watching the handover live from a nearby military base across the border. In Tel Aviv, hundreds of Israelis gathered at a rallying point now widely referred to as Hostages Square, crying, embracing and cheering as the release was aired on a giant screen.
The women were reunited with their families and then flown aboard helicopters to a hospital in central Israel. Video released by the Israeli military showed them embracing tightly with their parents, in smiles and tears.
The 200 Palestinians freed on Saturday include militants, some serving life sentences for involvement in attacks that killed dozens of people, according to a list published by Hamas.
Israel says those convicted of killing Israelis will not be permitted to return home. Around 70 will be deported to Egypt, Palestinian officials said, and from there to another country, possibly Turkey, Qatar or Algeria.
Another 16 were sent to Gaza and the rest were released to the Israeli-occupied West Bank, where cheering crowds waving Palestinian flags gathered in Ramallah to greet them.
DISPUTE
Joy in Israel over Saturday's release was clouded by disappointment after it emerged that Arbel Yehud, 29, who had been abducted with her boyfriend from their home in Kibbutz Nir Oz, was not among those released on Saturday.
An Israeli military spokesman called it a breach of the truce, while Hamas said it was a technical issue. A Hamas official said the group had informed mediators that she was alive and would be freed next Saturday.
Israeli Prime Minister Benjamin Netanyahu said Palestinians in Gaza would not be allowed to cross back to the northern part of the territory until the issue was resolved.
Palestinian officials said as many as 650,000 displaced people were waiting to return to the north beginning on Sunday under the ceasefire.
Israeli troops opened fire near crowds who gathered on a road hoping to go north, causing a stampede, witnesses said.
Medics said one person in the crowd was killed and two others injured by suspected Israeli fire. The Israeli military said troops had fired warning shots near gatherings of people that posed a threat, and it and was unaware anyone was hurt.
Thousands of people were massed with their belongings along the coastal road, where they said an Israeli tank continued to block the road to the north.
"I will not go back to the tent," Zaki Kashef, 26, waiting on the coastal road to return north from Deir Al-Balah where he has been sheltering with his family for more than a year, told Reuters via a chat app. "Where are the mediators? Why can't they force Israel to respect the deal?"
The ceasefire agreement, worked out after months of on-off negotiations brokered by Qatar and Egypt and backed by the United States, has halted the fighting for the first time in more than a year.
Following Saturday's release, 90 hostages remain in Gaza, according to Israeli authorities, who have declared around a third of them dead in absentia.
Twenty-six are still slated for release in the first phase, after which the sides are expected to negotiate the exchange of the rest, including men of military age, and withdrawal of Israeli forces.
Families of hostages due to be released in later phases worry that the ceasefire could break down first. Some Israelis critical of the truce say Israel must resume fighting to prevent Hamas from returning to power in Gaza. Hamas says it will not free all hostages until the war ends for good.
Israel launched its campaign in Gaza following the Oct. 7 Hamas attack, when militants killed 1,200 people and took more than 250 hostages to Gaza, according to Israeli tallies. Since then, Israel's campaign has killed more than 47,000 Palestinians in Gaza, according to health authorities there. More than 400 Israeli soldiers have also died in Gaza combat.