RAMALLAH, Palestinian Territories - Israel began handing over on Thursday the bodies of 91 Palestinians killed during anti-Israeli attacks, some of whom died more than 40 years ago, officials on both sides said.

The transfer began before dawn, when Israel formally gave the bodies to the Palestinians at a location near the West Bank city of Jericho, with 79 of them immediately transferred to Ramallah, and the other 12 sent to Gaza.

"At 4:00 am (0100 GMT) today, we received the remains of 91 martyrs, 79 from the West Bank and 12 from Gaza who had been buried (by the Israelis) in an inhumane and unethical fashion in numbered graves in the Jordan Valley," said Hussein al-Sheikh, head of the Palestinian general committee for civil affairs.

"They will all be wrapped in a shroud and the Palestinian flag, they will be identified and have the last rites performed," he said.

The Israel Defence Forces confirmed the first part of the transfer had taken place.

"In a joint IDF-COGAT activity, the first part of the transfer of terrorists' bodies to the Palestinian Authority was completed according to the government's decision," a spokesman said, referring to the decision to hand over the bodies announced by Israel earlier this month.

Guy Inbar, a spokesman for COGAT, the Israeli military body that deals with Palestinian civilian affairs, confirmed that the handover was "under way, but not yet completed."

He said most of the bodies had been transferred to the Palestinian Authority during the morning, with the remaining dozen en route to the Hamas-run Gaza Strip.

Several days ago, the Palestinian Authority had named the 91 "martyrs," which include eight members of a commando unit killed in March 1975 in an Israeli assault on the Savoy Hotel in Tel Aviv where they had barricaded themselves inside with hostages.

Israeli public radio said the bodies included those of militants responsible for a string of suicide bombings in Jerusalem, Tel Aviv and the southern city of Beersheva.

The move took place despite a legal challenge by Almagor, a group representing Israeli victims of Palestinian attacks, which had moved to stop the handover, the radio said.

The remains were to be transferred to the Muqataa headquarters of Palestinian president Mahmud Abbas at 2:00 pm (1100 GMT) where there would be "an official ceremony and prayers for the dead," Palestinian prisoners minister Issa Qaraqaa said.

Israel said it hoped the gesture would build confidence between the two sides and help revive the moribund peace process, which run aground in late 2010 in an intractable dispute over settlement building.

"We hope that this humanitarian gesture will serve both as a confidence building measure and help get the peace process back on track," said Mark Regev, spokesman for Israeli Prime Minister Benjamin Netanyahu.

"Israel is ready for the immediate resumption of peace talks without any preconditions whatsoever," he said in a statement.

Hussein said another handover of bodies was likely to take place in the coming weeks.

"We started negotiating on a second batch, made up of 70 martyrs, and we expect to receive them next month. But there are some difficulties in the negotiations because their names and identities are not clear," he said.

In July 2011, Defence Minister Ehud Barak blocked the transfer of the remains of 84 Palestinians buried in numbered graves in its "cemetery for enemy combatants" in the Jordan Valley, citing the need to review their identities.