Hamas has agreed to release 10 living hostages and return the bodies of 18 more, but the terms of the proposed deal have been deemed unacceptable by the U.S. and Israel.

The group, which has been on the State Department’s list of Foreign Terrorist Organizations since 1997, made the announcement in a statement Saturday and said it was being done on the condition that a number of Palestinian prisoners be returned in exchange as part of a means to achieve a permanent ceasefire.

Israeli media reported that Hamas added new demands to the proposal from U.S. Special Envoy Steve Witkoff, including a permanent ceasefire, complete Israeli withdrawal from Gaza and unrestricted humanitarian aid flow into the strip.

Witkoff’s proposal did not include a full withdrawal or a ceasefire, the Jerusalem Post reported, and that Hamas added terms of its own.

In a statement posted to X on Saturday, Witkoff called Hamas’ response to the American proposal ‘totally unacceptable’ and warned it ‘only takes us backward.’ He urged the group to accept the original framework in order to begin proximity talks as early as next week, which could pave the way for a 60-day ceasefire and the return of both living and deceased hostages.

In a statement before Witkoff’s response, Hamas wrote: ‘After conducting a round of national consultations, and based on our immense sense of responsibility towards our people and their suffering, the Islamic Resistance Movement (Hamas) today submitted its response to US Special Envoy Steve Witkoff’s latest proposal to the mediating parties. 

‘This proposal aims to achieve a permanent ceasefire, a comprehensive withdrawal from the Gaza Strip, and ensure the flow of aid to our people and our families in the Gaza Strip.’

Reacting to the announcement, the Israeli Prime Minister’s Office said in a statement that while Israel had agreed to the updated Witkoff framework, ‘Hamas continues to cling to its refusal.’ The office emphasized that Israel remains committed to bringing its hostages home and defeating Hamas, citing Witkoff’s remarks as confirmation that Hamas’ latest stance undermines progress.

Hamas is holding 58 hostages in Gaza. Of these, Israeli intelligence assesses that at least 34 are deceased, leaving approximately 24 believed to be alive. More than 250 people were captured during the Hamas terror attacks on southern Israel on Oct. 7, 2023. 

The latest proposal being negotiated involves the release of 10 living hostages and a number of bodies during a 60-day pause in exchange for more than 1,100 Palestinians imprisoned by Israel, including 100 serving long sentences after being convicted of deadly attacks, The Associated Press reported Friday, citing a Hamas official and an Egyptian official speaking on condition of anonymity.

U.S. negotiators had not publicized the terms of the proposal.

Witkoff’s office reiterated on social media that the proposed deal could allow ‘half of the living hostages and half of those who are deceased’ to return to their families if Hamas agrees to enter talks under the current terms. 

The statement stressed that the window to finalize the deal is narrowing, and that major negotiations could begin ‘in good faith’ within days if Hamas accepts.

‘As stated by the U.S. President’s special envoy to the Middle East, Steve Witkoff: Hamas’ response is unacceptable and sets the situation back,’ the Prime Minister’s Office said.

President Donald Trump said Friday that negotiators were nearing a deal.

‘They’re very close to an agreement on Gaza, and we’ll let you know about it during the day or maybe tomorrow,’ Trump told reporters in Washington. Late in the evening, asked if he was confident Hamas would approve the deal, he told reporters: ‘They’re in a big mess. I think they want to get out of it.’

Deep differences between Hamas and Israel have stymied previous attempts to restore a ceasefire that broke down in March.

Israel has insisted that Hamas disarm completely, be dismantled as a military and governing force and return all hostages still held in Gaza before it agrees to end the war. Hamas has rejected the demand to give up its weapons and says Israel must pull its troops out of Gaza and commit to ending the war.

The Associated Press and Reuters contributed to this report.