Palestinian President Mahmoud Abbas of Fatah and Prime Minister Ismail Haniyeh of Hamas have agreed on the make-up of a unity government and will submit it to parliament for approval on Saturday, officials said.
"We have finished all the issues relating to the formation of the government tonight, including the issue of the minister of interior," Haniyeh said after meeting with Abbas in Gaza.
Palestinians hope the deal will end fighting between secular Fatah and Hamas Islamists, as well as ease a crippling aid embargo of the Palestinian Authority, though it is unclear whether either goal will be accomplished.
A Hamas official named the new interior minister as Hani Al-Qawasmi, an academic with no known political affiliation.
The full cabinet line-up will be unveiled tomorrow, officials from both sides said.
Israel has vowed to boycott the unity government, including non-Hamas ministers, unless it recognises the Jewish state, renounces violence and accepts interim peace deals as demanded by the Quartet of Middle East mediators.
Washington has also made clear to Palestinian officials that the embargo will not be lifted until the three conditions are met.
Ahmed Bahar of Hamas, who serves as acting parliamentary speaker since Israel's arrest of the assembly's head Aziz Dweik last year, said Saturday's special session would begin at 11 a.m.
Legislators will discuss the unity government's political platform and hold a vote of confidence, he said.