The Palestinian Authority asked governing bodies to tone down public celebrations in Bethlehem this year as violence escalates between Palestinians and Israel, according to RNS.
The head of a government committee on churches in the West Bank confirmed the Palestinian Authority requested "a certain decrease" after dozens of Palestinians and Israelis have died in clashes since September.
Bethlehem, the official home of Palestinian Christmas celebrations, has been asked not to set of the traditional holiday fireworks this year and limit decorations in a bid to ease tensions.
The Palestinian Prime Minister, Rami Hamdallah, will light the large Christmas tree in the town's Manger Square but will not participate in the post-lighting dinner.
Around two per cent of Palestinians are Christian, and said to be upset at the decision. Ekram Juha is "a Christian and a believer" and works as director of the Bethlehem mayor's office.
"I'm truly disappointed," she told RNS.
Palestinians "have a difficult situation but we've lived with this situation for many years and celebrations have gone on," said Juha.
"This is the place where Jesus was born and if you limit Christmas celebrations here you are limiting something spiritual and holy. I can understand limiting celebrations elsewhere, but not here in Bethlehem."
Since the beginning of October 94 Palestinian have been killed in shootings and clashes with Israeli armed forces and 16 Israelis have been killed in attacks.