The Qatari emir announced plans to increase financial aid to the Hamas in Gaza from $245 million to $400 million, the Kuwaiti news agency KUNA reported.
Hamas gained control of the Gaza Strip in 2007 after winning a majority of seats in the 2006 Palestinian elections and violently ousting Fatah officials from the enclave.
The funds will be used to build two new neighborhoods, one for released prisoners, a youth rehabilitation center, roads and infrastructure, and to renovate existing hospitals, Israel Radio said.
Accompanied by his wife and a large delegation, al-Thani was greeted by Hamas prime minister Ismail Haniyeh and other senior Hamas officials. No Palestinians affiliated with Fatah were present.
Hamas hailed the visit as a breakthrough, ending "the political isolation of the government and opens the door to break the siege," the British daily The Guardian said.
Palestinian President Mahmoud Abbas welcomed the visit but did not travel to Gaza to greet the Qatari dignitary in person, Israel Radio said.
Israel criticized the visit.
"It is funny that Qatar's ruler intervenes in the internal Palestinian conflict and chooses to support Hamas," Ynetnews.com quoted an unnamed Israeli Foreign Ministry official as saying.