In September, a 5 percent increase in fuel price sparked demonstrations in Ramallah, Jenin and Hebron.
Thousands of demonstrators angered by poverty, corruption and the spiraling cost of living rallied outside Palestinian Prime Minister Salam Fayyad’s office, asking him to resign.
Many protesters were injured during the rally after clashes with Israeli soldiers.
The protests revealed West Bank’s fragile aid-dependent economy--which has been facing a deepening financial crisis because of a drop in assistance from Western and wealthy Gulf backers, as well as restrictions on trade by Israel.
Palestine has also experienced political upheavals throughout the year.
Clashes between Israel and Hamas, which began earlier in June resulted in casualties on both sides.
By the beginning of October, clashes between the two rivals intensified.
On November 14, an Israeli air strike on Gaza killed Hamas senior commander Ahmed el-Jaabari.
A day after, Hamas fired two rockets targeting Tel Aviv in the first attack on Israel's commercial capital in 20 years. The attack prompted a devastating war that lasted for eight days, and in which 160 Palestinians and 6 Israelis were killed.
With a ceasefire brokered by Egypt’s Islamist President Mohamed Mursi, the war ended and the truce came into effect on Nov. 21.
Days later, on November 27, Arafat’s body was exhumed after traces of a poisonous element were found in his personal belongings, which were submitted by his wife earlier this year to a Swiss institute.
When abnormal levels of polonium-21 were discovered in his clothes, Arafat’s widow Suha had him brought up again as part of an investigation, carried by French, Swiss, Russian and Palestinian teams.
Experts probing Arafat's case said results are expected the end of this year.
Along with all its ups and downs, the month of November ended with a joyful development for Palestinians.
After a 65-year quest for statehood, the United Nations General Assembly voted on recognizing Palestine as a non-member state on November 29.
The vote lifts the Palestinian Authority from an observer entity to a "non-member observer state", a step that will allow it to join the International Criminal Court, where the Palestinians could try and accuse Israel of war crimes.
In December, Hamas leader Khaled Meshaal ended 37 years of exile by visiting Gaza for the first time, marking Hamas’s 25th anniversary.
The visit was seen in Gaza as a victory against Israel.
Thousands of Palestinians and politicians from different factions lined up to greet Meshaal, who knelt on the ground to offer a prayer of thanks and wished to become a martyr on Palestine’s land.
On a remarkable note, Palestine was a destination for a number of Arab politicians in 2012.
Sheikh Hamad bin Khalifa Al Thani, the emir of Qatar, visited Gaza to inaugurate a Qatari investment project worth hundreds of millions of dollars.
Jordan's King Abdullah, meanwhile, visited the West Bank for the first time in more than a year in what analysts described as part of an internationally backed show of support for Mahmoud Abbas.