A senior Israeli source told the newspaper Israel will object to the participation of Hamas candidates but will be unable to block the militant group in the West Bank and Gaza.
The Israeli government likely will be subjected to public pressure to reject Hamas' participation, the newspaper said.
A Palestinian official told the newspaper Hamas wants to torpedo the elections so it can accuse Israel of blocking the democratic process to draw international condemnation, the paper said. The Palestinian Authority is expected to approve the move to embarrass Israel, the report said.
An agreement to hold the elections was reached two weeks ago in Cairo at a meeting between Palestinian President Mahmoud Abbas and Hamas leader Khaled Mashaal. Fatah and Hamas officials are scheduled to meet in the coming weeks again in Cairo to set a date for elections, the paper said.
The upcoming elections concern Palestinians living in East Jerusalem, the West Bank and Gaza and not the Arab population who live in Israel who hold Israeli citizenship.