While much of North America and Europe shivers in the grip of winter, visitors to Bethlehem were buying chilled fruit juice in Manger Square and stripping off sweaters in the mild weather.
Bagpipers played carols for some 15,000 visitors packing the stone flagged square opposite the small Door of Humility where pilgrims stoop to enter the multi-denominational church, built above the spot where Christians believe Jesus was born.
It's about 20 degrees (68 Fahrenheit) and it's a little hard to get that Christmas feeling I'm used to having, said Phillip Well, 22, from Germany.
Some tourists were bemused by the scene.
I'm not used to seeing marching bands and scout troops do the Christmas festivities, but it's entertaining, said 40-year-old Vijey Raghavan, of San Francisco, California.
Tourism in Bethlehem has picked up in the past few years, after collapsing during the Palestinian intifada, or uprising, which erupted in 2000. Hotels expect a 60 to 70 percent rise in business this year.
Still, many locals say development is hindered by elaborate security arrangements Israel has put in place to keep Palestinian attackers out, including an 8 meter (25 foot) high wall between Bethlehem and neighboring Jerusalem.
Visitors and local people cannot escape the sight of the wall but they were not allowing it to dampen the Christmas spirit. It's safe, it's warm, it's a happy time. It's good for visitors to see the good things too, said 16 year-old Bethlehem resident Reem Mohammad.
(Editing by Douglas Hamilton and David Stamp)