This paper attempts to shed some light on the underlying causes and the potential consequences of the ongoing developing humanitarian crisis in the Palestinian territories, and reflects on both short- and long-term policy measures needed to confront it. The paper argues that (1) the rapid deterioration in the Palestinian living conditions in West Bank and Gaza is not solely the product of the surprise ascent of Hamas to power, and that an already precarious humanitarian situation existed long before the sudden change in the Palestinian political landscape in January 2006; (2) that the abrupt cut off of the much needed financial resources to the post-election Palestinian Authority (PA) has led to a crippling financial crisis with potential grave adverse consequences on all fronts; (3) that the attempt by Western donors to "bypass" the Hamas-led government by channeling aid directly to the Palestinian people through other agencies, UN or NGOs, may not be as easy as thought due to real-life limitations; (4) that all parties share moral responsibility in the short term to take urgent measures to alleviate Palestinian mounting human suffering; and (5) building on the experience of the past decade, and given the political and territorial realities that exist today in the West Bank and Gaza, foreign aid, at best, may help mitigate Palestinian hardship, but it will not end it; nor will it enable the Palestinian people to build a self sustained economy without first altering the conditions that underpin their current misfortune. Only a fair, negotiated political settlement will.