"Victory is near and we will meet you in Gaza in the near future," Abbas said in a short speech from his West Bank headquarters in Ramallah, beamed to the Gaza crowd at the Saraya complex on giant screens.
"Gaza was the first Palestinian territory rid of (Israeli) occupation and settlement and we want a lifting of the blockade so that it can be free and linked to the rest of the nation."
Hamas, in a sign of reconciliation with Fatah, permitted the rally to go ahead as the climax of a week of Gaza festivities celebrating the 48th anniversary of Fatah taking up arms against Israel.
Demonstrators, many of them women and children waved Palestinian and Fatah flags and carried pictures of Abbas, an AFP correspondent reported. Balloons in the colours of the Palestinian flag with portraits of Abbas hovered above.
"This crowd is a vote in favour of (Abbas's) Palestinian Authority and shows that Fatah is still out in front," local Fatah leader Selim al-Zaraei told AFP.
Fatah Gaza spokesman Fayez Abou Eita told AFP that "hundreds of thousands of people are currently taking part in the public festivities."
Hamas congratulated Fatah on the anniversary, saying it considered it a "celebration of national unity and a success for Hamas as well as Fatah."
"This positive atmosphere is a step on road to restoring national unity," it said.
Abbas's address was to be followed by a speech by senior Fatah official Nabil Shaath, who travelled to Gaza from the West Bank for the event. He was to be followed by Hamas official Rawhi Mushtaha, who was to speak in the name of all the Palestinian factions.
But Shaath and Mushtaha did not end up delivering their speeches after the crowd became rowdy, Abou Eita said.
Khan Younis resident Ayman Barbakh, 24, said he hoped the rally marked "the beginning of true unity and reconciliation, because our Palestinian people have suffered enough."
"It's been six years since we in Fatah have been waiting for this moment," said participant Sabrine Srour. "I feel the joy I can see on people's faces."
A young man attempting to fasten a Fatah banner to an electricity pylon was killed and seven others were injured by electrocution, medical sources said.
Some participants brandished portraits and chanted slogans in favor of ex-Fatah strongman in Gaza, Mohammed Dahlan, excluded from his movement and reviled by Hamas.
Hamas and Fatah had been at loggerheads since the Islamist movement seized control of Gaza in June 2007, following its victory in Palestinian parliamentary elections the previous year.
The anniversary commemorates the first operation against Israel claimed by Fatah's armed wing, then known as Al-Assifa (The Thunderstorm in Arabic), on January 1, 1965.
Israel considers Hamas a terrorist organisation, and is opposed to it moving closer to Fatah.
The reconciliation process
The two groups reached an Egyptian-brokered unity agreement in April 2011, although its main articles have not been applied so far.
In December, leaders of Hamas and Fatah called for the renewal of reconciliation attempts that has been totally stalled for more than a year.
In Gaza, the exiled head of the Hamas movement Khaled Meshaal, in his first ever trip to the coastal territory, said it was time for the bitter opponents to make good on the deal they signed in Cairo in 2011.
"We want national unity in the armed resistance and popular resistance. I urge you towards reconciliation and national unity of the Palestinian ranks," he said in a speech at Gaza's Islamic University.
"Palestine is too big for a single movement," he added. "Palestine is for all of us, we are partners in this nation. Hamas cannot do without Fatah or Fatah without Hamas, or any movement."
"We are under occupation, we need free and fair elections, then a national partnership to assume responsibilities," Meshaal said later during a meeting with the families of those killed in last month's conflict between Israel and Gaza militants.
Meanwhile, Abbas called at a meeting in Doha for reconciliation efforts to resume, saying holding the elections called for in 2011 would be the key.
"Without these elections there will be no reconciliation," he said at an Arab League gathering in Qatar.
In a speech at a rally celebrating Hamas's 25th anniversary, Meshaal also called for new efforts to implement the 2011 deal, which stalled over the formation of an interim consensus government before new elections.
The 2011 deal agreed in Cairo was intended to pave the way for presidential and legislative elections by May 2012, but disagreements over who would head a transitional government snarled implementation of the agreement.
In the beginning of 2012, Meshaal and Abbas signed a new deal in Doha, under which the president would head the interim government. But Hamas leaders in Gaza rejected the deal, and accused Meshaal of taking decisions without their backing.
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