The grand procession starting at 11 a.m. (0900 GMT) was attended by hundreds of foreign dignitaries from some 80 countries and organizations, including at least 16 heads of state, mostly from the Arab world.

Emotions soared when Arafat's flag-draped coffin was trailed down Salah Salem Street.

Arafat's widow Suha Arafat and their daughter Zahwa were seen wailing inside the procession.

Arafat who led the Palestinians for four decades was declared dead Thursday after failing a battle for life at a French hospital. He was aged 75.

Arafat devoted all of his lifetime to the cause of establishing a Palestinian statehood with Jerusalem as its capital, but failed to wait to see this dream become true.

He had ever said: "Jerusalem, without you, my dream is not complete."

Though labeled by Israel as an enemy, Arafat was admired by the world for his extraordinary political courage, conviction and charisma and deeply loved by his own people.

After the one-and-half funeral service, Arafat's body will be flown back to his battered headquarters in the West Bank city of Ramallah for burial scheduled at 4 p.m. local time (1400 GMT).