Hopes of Palestinian unity seem to have shattered as both the rival factions Hamas and Fatah failed to reach any agreement during Egypt mediated talks.
The delegations are headed back from Cairo, Palestinian news agency Ma'an reported.
Monday's report, however, suggested an agreement "in principle" between the two groups to set up a joint security force in Gaza that would have marked Fatah's return in the coastal strip after it was ousted in a violent conflict by Hamas in June 2007.
However, Hamas spokesperson Fawzi Barhoum who was unaware of the collapse of talks, did not know about the return of his faction's delegates to Gaza Strip and other Arab countries, the agency said.
Barhoum said that a third session of dialogue would be held to try and end the three unresolved issues of elections and security, including the suggested joint Fatah-Hamas security force which Hamas has rejected, as well as joint factional committee proposed by Egypt.
Palestinian officials in Cairo reportedly said that President Mahmoud Abbas would not waste time and ask caretaker Prime Minister Salaam Fayyad to form a new government as soon as possible in the wake of failure of talks.