The Judean Desert has always been known as a place of prophecy. Something about the swirling sand, the relentless sun, the endless sky--and maybe the lack of water--urges otherwise ordinary folk to start soothsaying. In the Bible, the prophecies-from-the-desert usually came true. These days, another kind of prophet is predicting the future of Jericho, a desert town located in the territories controlled by the Palestinian Authority that is gambling on its future. Literally.

Jericho's $50 million prophet is Casinos Austria, a well-known European chain of gambling houses that opened its first branch in the Holy Land last fall. Gambling is illegal in Israel, but hundreds of thousands of Israelis flock to casinos in Greece, Turkey and Eastern Europe every year. And American and European tourists in Jerusalem are continually in search of more to do at night.

Casinos Austria knew it had a ready-made audience for gaming, but it faced more barriers than usual once it decided to build on Palestinian territory. For starters, the location had to be safe, with little chance of political violence coming near. It had to be sensitive to the local observant Muslim population, which assiduously guards against religious violations, including gambling. It had to be aware of Jewish festivals, especially the High Holiday period, when nearly all Israeli contractors and businesses shut down. It had to be Western enough to remain accessible to the American convention and tourism market and Eastern enough to appeal to the Arabs of the gulf, whom it hopes to cultivate. And it had to have access to an eager, plentiful work force that could get by in English, the casino's official language.

To make matters even more complicated, Casinos Austria needed a site with abundant, cheap land--suitable for a five-star, 220-room hotel, an 18-hole golf course, a tennis court, pool, shopping arcade and health-club facility, and at least two gourmet restaurants. It's all part of Casinos Austria's five-year plan to construct the Palestinian Authority's first convention center and Western-style resort.

Impossible? This is a region that has seen a few miracles. And the unlikely success of the Oasis Casino, which operates across the street from a rundown Palestinian refugee camp, may help rejuvenate the rest of Jericho. Now, all signs show that this onetime winter resort town for the local elite--situated at the lowest, oldest inhabited spot on Earth--is preparing to recapture its former glory.

Jericho is as close to Jerusalem as the Manassas Civil War battlefields are to the Washington suburbs. Jericho has seen its share of battles, too. The biblical Joshua captured Jericho for the Israelites, and it was among their first homesteads after the 40-year exodus from Egypt. During this century the region has been under Ottoman, British and Jordanian control, and Israel captured Jericho during the 1967 war. But it was the first town, along with the Gaza Strip, that Israel handed back to the Palestinian Authority government in 1995, following the Oslo peace accords. Since then, local and international businesses have been working on a way to make sure the tourists stay.

Unlike with Hebron, or other parts of the West Bank, tourists never stopped coming to Jericho. Even when it was at its most destitute, and the U.S. State Department warned of security risks in the Israeli territories, the adventurous, the religious and the merely curious explored the town where the walls came tumbling down. It has long been the second leading area for Palestinian tourism, after Jerusalem's Old City. But no one ever spent the night in Jericho. The Oasis Casino and its near neighbor, the Jericho Resort Village, along with other new facilities, are trying to change that by reconfiguring one of the most popular tourist corridors in the world: that linking Masada, the Dead Sea, the Jericho area sites and Jerusalem.

The Oasis Casino hasn't turned Jericho into Vegas--or even Atlantic City--but it has helped put Jericho back on the map. It is the largest private employer in the Palestinian Authority, with 800 Palestinian employees and 285 expats from 29 countries. When the casino is in action, as it is 24 hours a day, 7 days a week, every single one of those employees has a job to do. Casino capacity is 2,000, but on a typical Friday at midnight more than 2,300 people pack the floor, smoking, betting, jostling through the throng and kibitzing with friends at nearby stations. Thirty-five gaming tables and 220 slot machines keep the crowds busy.

Only guests with a foreign passport are allowed into the Oasis, and 94 percent of its visitors are Israeli Jews and Israeli Arabs, according to Andrew Davies, the Oasis general manager. But recent initiatives offering all-expenses-paid day trips from hotels in Jerusalem, Tel Aviv and the north of Israel have brought in an increasing number of Americans and tourists from other countries. These are pilgrims only in the broadest sense, worshiping at the altar of the almighty dollar. In many cases, they would have no other impetus to cross the border if not to give their American greenbacks to Palestinian croupiers, who then hand it to European bosses.

But not everyone thinks the Oasis Casino is worth betting on. Suha Arafat, Yasser Arafat's wife, has called it a "disgrace," and tales of corruption are impossible to sidestep: Some Palestinian Authority officials responsible for pushing through permits and tax benefits for the casino are also said to claim a financial stake in its success.

For everyone involved, success is critical. The question unsettling the dust is whether or not tourists will choose to make Jericho home base in the Holy Land. "Our premise is that if we build a resort, they will come," Davies said. It's a field-of-dreams mentality, and he shares it with local Palestinian businessmen sporting hard hats and barking into cell phones at construction sites all over the PA. It may just work, especially with 2000 approaching. The Vatican has predicted that as many as 6 million pilgrims may visit the Holy Land to celebrate Christ's birth next year. Although the Israel Ministry of Tourism expects half that number, few believe that the existing hotels--especially those in Jericho, Bethlehem and Nazareth, Arab towns that are major pilgrimage sites--can house them all.

But the millennium isn't the only force behind Jericho's newfound focus on tourism. Today's quest for peace in the region is fueling Jericho's building boom, said Bajis Ismail, director general of the Palestinian Authority's Ministry of Tourism and Antiquities. "Tourism can promote peace," Ismail said. "It allows people to meet and talk who would never otherwise know each other."

There's no escaping politics in this part of the world, even for the most experienced businessmen. "For me, this is personal," said Zuhayr Amad, chairman of the board of the new Jericho Resort Village, Jericho's first resort and site of the town's only swimming pool. He surveyed the topaz-clear pool outside, the tastefully tiled lobby, the immaculate staff doing its jobs silently and well. "I have this dream that political compromise on both sides will come. It might drag on, but it will come. In the meantime, we are here, doing something good for the country."

For tourists who stay at the Jericho Resort Village, the future resort at the Oasis or elsewhere in Jericho, the town is working hard to be welcoming. It has nothing to prove in terms of historical sites. Jericho boasts easy access to Qmran, where the Dead Sea Scrolls were found, as well as Masada, site of the first-century Jewish revolt against the Romans. The Dead Sea, the lowest, saltiest point on Earth, branches off the Jerusalem-Jericho Highway.

Many of the region's top draws fall within Jericho's borders. Herodion, King Herod's immense palace (built around 15 B.C.) is carved out of a hilltop; it later served as a shelter for Jewish rebels, a Roman administrative center and a Byzantine monastery. The nearby Field of Ruth is commonly recognized as the setting for the biblical Book of Ruth, and two separate sites, both called Shepherds' Field (one Greek Orthodox and one Roman Catholic), claim association with the shepherd's stories in the Gospel of Luke.

Lesser known to Westerners is Hisham's Palace, an 8th-century Muslim ruin from the Umayyid period which boasts the largest bathhouse in antiquity. Its other remains include royal buildings, a mosque, water fountains and spectacular mosaic floors. History and archaeology buffs also flock to the Tel as-Sultan, a 10,000-year-old excavated settlement discovered in the 1950s. The Tel (Hebrew and Arabic for hill) was created by the different layers of civilizations that lived and built on the spot from the early Neolithic period. It contains the oldest retaining wall ever excavated, as well as the world's oldest stairway.

A cable car, under construction, will link the Tel to Mount Temptation, where Jesus is said to have withstood the first and third temptations of his 40 days of solitude. In the meantime, Mount Temptation is an easy uphill hike, and the Bedouins at the base of the mountain offer glasses of mint tea to strengthen visitors for the walk. Pilgrims also make sure to stop at the 2,000-year-old sycamore tree before which, according to legend, Jesus paused during his sojourn through Jericho.

Always an equal-opportunity town, Jericho's ancient synagogue offers a vivid 6th-century mosaic floor decorated with Jewish symbols and geometric motifs. It was excavated in 1936 but only restored in the mid-1980s and made public in 1987. The Aramaic and Hebrew dedication in the tiles shows that 6th-century residents shared the same concerns with those in the 20th century: "Peace Unto Israel."

The person who fixed these tiles in place may not have been one of the Judean Desert's finest prophets, but he certainly knew Jericho would be a welcome oasis in the desert for all who followed.

Both the Jericho Resort Village (telephone 011-972-2-232-1255) and the Oasis Casino (011-972-2-231-1111; www.oasis-jericho.com) will host large-scale events for New Year's Eve. For more information on Jericho, the Palestine Authority's Ministry of Tourism and Antiquities maintains a Web site at www.visit-palestine.com.

Alison Buckholtz has written frequently for Travel about the Middle East.

CAPTION: Gamblers hit the tables at the Oasis Casino, an unlikely--and wildly popular--addition to the Holy Land.