Refusal by Muslims to accept Jews as equals is the source of the conflict.

I am copying the response by Chaim Handler on Quora to this question:

Why couldn’t Jews and Arabs get along in Palestine? Is Zionism the source of the conflict?

Handler replied:

Obviously Zionism is the cause of the conflict, just as Abolitionism was the cause of the conflict between the Union and the Confederate States, leading to the United States Civil War. Correcting injustice can harm those who benefit from that injustice, even if that injustice is not their fault. In the case of Zionism, the injustice was 75 generations of subjugation and persecution of an entire nation in exile.

In the words of the Arab mayor of Jerusalem during the late 19th century, Yusuf Diya al-Khalidi: “Zionism in principle is natural, beautiful, and just… Who could contest the rights of the Jews in Palestine? My God, historically it is your country”. He wrote this in March 1899 in a letter to the chief Rabbi of France. Of course there was a “but”, and the “but” was just as true as his admission of the justification for ZIonism. He argued that implementation of Zionism would cause upheaval for the Arab population, and it would, without any doubt. That fact was not about to deter the Jews from exercising the rights that even he acknowledged as just.

When the League of Nations decided to implement Zionism as an integral aspect of the Mandate for Palestine, they had to weigh what they termed “the grounds for the reconstitution of the Jewish national home” against the right of what they termed the “existing non-Jewish communities in Palestine” to self-rule, and their verdict was that the non-Jewish communities in Palestine were not entitled to further deny the Jewish People their liberty within their ancestral homeland.

At the time there were approximately 500,000 Ottoman Arabs living in what was defined by the Allied Powers as Palestine. For every one of those Arabs there were at least 25 Jews in the world who had parents, grandparents, great-grandparents… 75 generations of antecedents, all of whom were denied their freedom and persecuted because of their religious and ethnic background. More than a century of “enlightenment” had not led to an end to the persecution of the Jews and there was no indication that the injustices suffered by Jews in the diaspora would end. This could be the last opportunity to put an end to the exile of the Jewish People. How could they allow such a chance to slip away?

Their recognition of the humanitarian crisis caused by anti-Jewish persecution was proven correct in the most extreme and tragic manner barely two decades later, when a third of the Jews in the world were exterminated by the Nazis. The reconstitution of the Jewish national home was not only “just” but necessary. The former Ottoman Arabs populating the Near East were achieving their independence with the establishment of many vast lands from Egypt to the Emirates, including Syria, Saudi Arabia, Transjordan, Iraq, Lebanon, Yemen, Qatar, Bahrain, Oman, Kuwait, etc.

While the Palestine was to be the Jewish home, it was made clear that the Jewish home was to be governed as a democracy where the civil rights of all were to be protected, non-Jews would have complete religious freedom, and their culture and lifestyle would be preserved. In fact one of every five Israeli citizens is Arab and enjoys full equality and democratic rights, and few Israeli Arabs today regret that their parents or grandparents chose to remain rather than fleeing to lands where they would live under Arab hegemony but lack the freedoms and opportunities Israel affords them.

Certainly Zionism caused conflict, but that fact does not prove that Zionism is unjust. To a great extent the harmful effects of the implementation of Zionism could have been prevented, had the Arabs demonstrated any appreciation for the reality that Yusuf Diya al-Khalidi acknowledged in his letter. Most if not all of the hardships suffered by the Arabs as a result of Zionism were the effect of their futile resistance to what turned out to be inevitable. They didn’t care about the legitimate rights of the Jewish People. They cared only about the privilege they believed themselves entitled to as Arabs and Moslem in the predominately Arab Middle East. They see themselves as the victims of Israel’s failure to allow the Arabs to defeat them, which is really sad and pathetic.

At this stage the conflict is perpetuated only by the stubborn refusal of the Palestinians to reconcile themselves to the reality that has existed 73 years. There is no turning back the clock. Looking forward the Palestinians and Israelis can be partners in a mutually beneficial future, or the hardships being suffered by the Palestinians can continue indefinitely. The choice is theirs.