Fatah's seven-year rivalry with militant group Hamas officially ended Monday with the formation of a unity government between the two factions.

The signing of the unification was broadcast live in Gaza and the West Bank, according to The Guardian.

The unification of the two factions will likely complicate the Palestinian Authority's relationship with the United States, European Union and Israel, as Hamas is considered a terrorist organization by most Western nations.

State Department spokesperson Jen Psaki said that U.S. Secretary of State John Kerry called Palestinian President Mahmoud Abbas to "express concern" about Hamas' role in the government. While the U.S. said it would work with the new unity government, it will keep a close watch on the government to ensure that it adheres to democratic principles and is not influenced by Hamas' militancy.

Israel rejected the new government, opposing Abbas' deal with Hamas. Israel put an indefinite moratorium on peace talks in April when a deal was signed between Fatah and Abbas that paved the way for the unification government.

Israeli Prime Minister Benjamin Netanyahu denounced the deal Monday.

"Today, Abu Mazen [as President Mahmoud Abbas is known] said yes to terrorism and no to peace," Netanyahu said to members of a security cabinet.

The security cabinet authorized Nethanyahu to impose sanctions, which are still not specified, against the Palestinian Authority due to the new deal with Hamas. Israel will also hold the Palestinian Authority culpable for any attacks that originate from the Gaza Strip, which are mostly perpetrated by Hamas.

Israel also said it would work to prevent Palestinian elections -- in which Hamas participates -- from taking place.

Abbas swore in a 17-member cabinet comprised of technocrats backed by both Fatah and Hamas. The Cabinet merges two rival governments: the Hamas government that controlled the Gaza Strip after it seized it from Fatah in 2007, and Fatah, which controlled areas in the West Bank.

Three new ministers failed to attend the meeting Monday in Ramallah in the West Bank because of Israeli travel restrictions between the West Bank and Gaza.

Abbas announced that he will visit Gaza for the first time since 2007.

Abbas said the ministers will try to broker peace between the Palestinian Territory and Israel, although Hamas refuses to recognize Israel's right to exist.

"Today, and after announcing the government of national unity, we declare the end of division that caused catastrophic harm to our cause," Abbas said.

The new government paves the way for the long-awaited Palestinian elections, which are scheduled to occur in 2015.

Meanwhile, Netanyahu slammed the government of the European Union for condemning the deadly attack at a Jewish museum in Brussels, but failing to criticize the Fatah-Hamas unity government.

"It is puzzling to me that governments in Europe that strongly criticise this act of murder speak with ambiguity and even friendliness about a unity government with Hamas, a terror organisation that carries out crimes like these," Netanyahu said.

The ceremony was delayed due to a dispute over who would be the foreign minister, and after Hamas opposed Abbas' attempt to abolish the prisoners' minister position. It was decided that prisoners would stay within the government portfolio, and that prime minister Rami Hamdallah will hold the position.

The new government will be comprised of five ministers from Gaza, and will be headed by Hamdallah.

While Israel doubts the new government's commitment to achieving peace, Abbas said the government will reject violence, abide by existing agreements and recognize Israel's existence.

Israel insists that the signing of the new deal places the onus on Abbas to demilitarize Gaza as specified in the Oslo peace agreement. Israel says there are up to 12,000 missiles and rockets in Gaza that are under Hamas' control.

The unity government is also likely to receive less aid from the United States and the European Union due to inclusion of Hamas.

The West has provided hundreds of millions in aid to the Palestinian Authority each year. A reduction in Western aid will further damage the territory's ailing economy, as there are already less philanthropic donations, as well as economically crippling Israeli restrictions on trade.

A senior Palestinian official told The Associated Press that the wealthy Gulf state of Qatar will cover any deficits, but a loss in U.S. and E.U. funding could still severely damage the already frail economy.