"The Holy See supports the right of your people to a sovereign Palestinian homeland in the land of your forefathers, secure and at peace with its neighbours, within internationally recognised borders," the Pope said.
The Pope will hold Mass in the Church of Nativity, supposedly built on the site of Jesus' birth, and later give a homily in Manger Square before visiting a refugee camp.
On Tuesday, on the second stop of his Middle East tour in Israel, the Pope said that victims of the Holocaust would never be forgotten.
Speaking at the Yad Vashem Holocaust Memorial in Jerusalem, the Pope said, "May the names of these victims never perish. May their suffering never be denied, belittled or forgotten."
The Pope spoke out against anti-Semitism saying, "Sadly, anti-Semitism continues to rear its ugly head in many parts of the world.
"This is totally unacceptable. Every effort must be made to combat anti-Semitism wherever it is found."
The Pope also laid a wreath on a stone at the Yad Vashem memorial, under which rest the ashes of victims of the Holocaust. He then met and shook hands with six survivors of the Holocaust.
The Pope said of those killed, "They lost their lives, but they will never lose their names."
"These are indelibly etched in the hearts of their loved ones, their surviving fellow prisoners and all those determined never to allow such an atrocity to disgrace mankind again."
The Pope also called on leaders in the Middle East to do everything in their power to help bring peace to the troubled region.
He said, "I plead with all those responsible to explore every possible avenue in the search for a just resolution of the outstanding difficulties so that both people may live in peace in a homeland of their own within secure and internationally recognised borders."
