In the Interim Agreement of 1995, Israel and the PLO agreed to cooperate on a People-to-People Program in accordance with concepts developed together with Norway. This paper describes the Program that thus was established. The People-to-People Program, which constitutes a unique peace building effort, was governmentally initiated, and represents a blurring of the lines between peace making and peace building. It was established to supplement the peace process by involving the two populations in this process. One of its primary objectives was to facilitate cooperation, based on equality and reciprocity. However, structural and social factors challenged this goal. The paper analyzes three dimensions: 1) impact and evaluation; 2) the relationship between the peace process at large and the People-to-People Program; and 3) the influence of the asymmetrical relationship between the two parties in the Program. Finally, the third- party role of the Fafo Institute for Applied Social Science is described. The paper covers the period from September 1995 to mid-2000.