Christians celebrated Bethlehem's merriest Christmas in eight years Wednesday, with hotels booked solid, Manger Square bustling with families and Israeli and Palestinian forces cooperating to make things run smoothly. Outside the Church of the Nativity, the traditional birthplace of Jesus, good-natured crowds of pilgrims and townspeople gathered for the midnight Catholic mass that is the holiday's highlight. Latin Patriarch Fouad Twal said in an address during the late-night service that true security comes from God. "War does not produce peace, prisons do not guarantee stability. The highest of walls do not assure security," said Twal, the Catholic Church's top cleric in the Holy Land. "Peace is a gift of God, and only God can give that peace." Pope Benedict XVI also spoke of peace between Israelis and Palestinians during Midnight Mass at the Vatican. "Let us think also of the place named Bethlehem, of the land in which Jesus lived, and which he loved so deeply," said Benedict, who is expected to visit the Holy Land in May. "Let us pray that peace will be established there, that hatred and violence will cease. Let us pray for mutual understanding, that hearts will be opened, so that borders can be opened." Earlier, a dozen pilgrims from India, Canada, Britain, the US and other countries sang impromptu renditions of Christmas carols. David Bogenrief, 57, of Sioux City, Iowa, played the trumpet. "Jesus was the prince of peace, and he can bring that peace to you. We pray for you," Bogenrief told a gaggle of children who gathered to listen. In Manger Square, vendors hawked roasted peanuts and Santa hats. Many in the square were Muslims out to enjoy their town's annual moment at the center of world attention. "Bethlehem is like the soul of the universe, and it's like an explosion of love here," said Stefano Croce, 46, a fashion photographer from Rome, Italy. Bethlehem has suffered from the Israeli-Palestinian fighting of recent years, and is now surrounded on three sides by concrete slabs and fences - part of a barrier Israel has built against Palestinian suicide attackers, some of whom came from Bethlehem. The Palestinians see the barrier as a land grab and say it has strangled the town's economy. Emigration has cut the town's Christian population to an estimated 35 to 50 percent of its 40,000 people, compared with 90 percent in the 1950s. Israel has held peace talks over the past year with the moderate West Bank government of President Mahmoud Abbas, and the spirit of cooperation has allowed Palestinian forces a limited measure of independence in places like Bethlehem, under Israel's overall security control. Eyad Sirhan, the IDF officer responsible for coordination in Bethlehem, said this week that he can talk to his Palestinian counterpart any time, "24 hours a day," about everything from police patrols to garbage collection. Every detail of the holiday preparations was meticulously discussed by the sides, Sirhan said. Safer times mean the Palestinians have counted more than 1 million visitors to Bethlehem so far this year, a rise of more than 20,000 from 2007.