OCCUPIED JERUSALEM, 11 May — Israel ended its 38-day siege of Bethlehem’s Church of the Nativity early yesterday and its troops withdrew from the West Bank city.

Thirteen Palestinians on Israel’s most-wanted list were flown to Cyprus, the first stop in an exile that will take them to third countries under a European-brokered deal to end the siege that left one of Christianity’s holiest sites strewn with rubbish and pockmarked by bullets. Twenty-six other Palestinians considered less serious offenders by Israel were expelled from the West Bank and taken by an armored bus to Gaza. They were greeted as heroes by flag-waving crowds and will be housed in a beachside hotel.

“The end of the standoff in Bethlehem is a positive development that removes an obstacle to restoring security cooperation between the parties and should advance the prospects for resuming a political process toward peace,” US President George W. Bush said in a statement. “That’s positive news in a troubled region,” he said later in a speech in Ohio.

Israeli troops pulled out of Manger Square to the outskirts of Bethlehem as cheering Palestinian children ran toward the church and calls of “Allahu Akbar” rang out from loudspeakers in mosques.

The gunmen emerged as heavily armed Israeli soldiers ringed Manger Square. Some strode defiantly past the troops after leaving the church. Women relatives stood on nearby rooftops calling out the men’s names. Some wailed and others shouted abuse at Israeli troops. “Goodbye, our beloved ones!” yelled a middle-aged woman.

One by one the 13 slated for exile boarded a bus that took them to Tel Aviv’s airport. A British military aircraft flew them to Cyprus, where they were taken to a seafront hotel.

European diplomatic sources said Italy, Spain and other countries were willing to take some of the wanted men. Diplomats have said there were no plans to keep them in custody.

Israel said it reserved the right to seek the extradition back to the Jewish state of the 13 exiled. “We reserve the right to ask for extradition depending on the circumstances. Every country that agrees to take them should keep an eye on them,” Foreign Minister Shimon Peres told a news conference in Rome.