The cash-strapped Hamas government is promising $50,000 (â‚¬38,000) to dress up Jesus' traditional birthplace for the holiday, more than twice the amount spent in previous years.
Yet even the extra cash - if Hamas pays up - may not be enough to bring Christmas cheer to Bethlehem, hit hard by the last six years of Israeli-Palestinian fighting. In the biblical town poverty is deepening and Christians are leaving Bethlehem in droves.
Palestinian Tourism Minister Joudeh Morkos has modest expectations.
Last year, only about 2,500 foreign visitors came on Christmas, but he's counting on the usual busloads of Christians from Arab towns in Israel to boost turnout. Before the outbreak of the Palestinian uprising in 2000, Bethlehem drew more than 90,000 pilgrims a month.