A network of trenches, barbed-wire fences, walls, and military checkpoints is closing off the holy city of Bethlehem. The siege is becoming harsher every day.

"It is choking the Christian community," says the Rev. Alex Awad, dean of students at Bethlehem Bible College. "There is utter depression here."

On many days, the Church of the Nativity—once crowded with tourists and worshippers—is strangely quiet, as only a handful of people visit. The city was refurbished with tens of millions of dollars in renovations in the hopeful years leading up to the millennium, but now windows and streets are grimy, shops are shuttered, and hotels stand empty.

The unemployment rate in Bethlehem is 65 percent, and Awad has heard that as many as 500 Christian families left the town in the last six months.

The Rev. Mitri Raheb, senior pastor at Christmas Lutheran Church, says Bethlehem's isolation has been growing for over three years. "As a pastor, I'm talking to many families where the husband and the wife are fighting, because the man is unemployed," he says. "Children are fighting, neighbors are fighting, brothers are fighting, sisters. You have this overload."

Divided by Fear
The Israeli plan is to build 30 miles of fences and walls around Bethlehem, and to post red signs that warn, in three languages: "MORTAL DANGER—MILITARY ZONE. Any person who passes or damages the fence ENDANGERS HIS LIFE."

"There will be just to the east [of Bethlehem] a small opening. They are working day and night, 22 hours a day," Raheb says. About ten miles of the barrier are already complete, and military outposts and Jewish settlements control other normal entry points.

The entire community is suffering from unprecedented Israeli security restrictions that have become ...