Sharon plans a total Israeli withdrawal from the Gaza Strip and the dismantling of some settlements in the West Bank, Israeli officials say. This would represent the first pullback by Israel from occupied territory since its withdrawal from a swath of southern Lebanon nearly four years ago.
Sharon's plan has won cautious international support. But some diplomats and analysts fear that it could end up being a substitute for negotiations toward an Israeli-Palestinian peace and possibly even deepen the conflict.
The plan would also be the first major change in control of Palestinian territory without direct negotiations between the two sides and the first evacuation of established Jewish settlements since Israel withdrew from the Sinai peninsula in 1980 as part of the Camp David accords with Egypt.
A White House official said last week it was too early to say that the president was ready to endorse the Sharon plan. But after meetings March 1 between aides to Bush and Sharon, National Security Council spokesman Sean McCormack gave an upbeat assessment, signaling that the White House would like to embrace it.
Bush's formal acceptance of Sharon's plan could come late this month or early next month - a tentative date for a Sharon trip to Washington.
Analysts say the ramifications of an Israeli pullout are potentially huge for Israelis, Palestinians, U.S. policy in the region and the war on terrorism.
One of the biggest uncertainties is what will fill the power vacuum in the Gaza Strip after the pull-out of Israeli troops, who now guard 17 Jewish settlements and patrol the border with Egypt.
Israeli and some U.S. officials dismiss the possibility that the militant group Hamas, responsible for attacks that have killed hundreds of Israelis, could end up seizing control of Gaza, saying the organization lacks the money and guns to crush the Palestinian Authority's security forces.
But even some Palestinians say the danger is real, given the collapse of the Palestinian economy and signs of continuing disintegration of the Palestinian Authority, headed by Yasser Arafat.
"They're crumbling. They're falling apart," said Edward Abington, a retired U.S. diplomat who lobbies for the authority.
After Israel withdrew from southern Lebanon, the militant group Hezbollah quickly moved to fill the void, gaining strong influence in the region. Hezbollah also boosted its prestige by claiming that its war of attrition against Israeli soldiers ultimately forced them out.
Another big uncertainty is how much of a withdrawal Israel will undertake in the West Bank. Bowing to U.S. pressure, Sharon plans to shift the route of the barrier Israel is building. The so-called wall or fence, which has become the source of an international outcry, will be brought closer to the armistice line that served as an unofficial border between Israel and Palestinian areas until the 1967 war.
But he also plans only a partial pullout from the West Bank, taking down only small outlying settlements deep in Palestinian territory.
"The Palestinians are obviously not going to get everything they want," said an Israeli official, speaking on condition of anonymity. Israel won't prevent, but won't encourage, Gaza settlers moving to established settlements in the West Bank, the official said.
The Israeli official also did not dispute news accounts that Sharon hopes to win U.S. acceptance of some of the most populous settlements, including Ariel in the center and Maale Adumim and the Etzion bloc outside Jerusalem. This would be the first American approval of any such land transfer outside of the negotiation process. Most of the world views the settlements as a violation of international law.