According to Biblical accounts, the Israelites left Egyptian captivity and took over the land from the Canaanite and other tribes living there.
Over time, the land has fallen under the rule of multiple invading countries. The Assyrians, Babylonians, Persians, and Alexander the Great all conquered the land between 722 and 167 BC during which many of the Jewish people were exiled or fled do to persecution. Around 61 BC the area fell under Roman control until about 600 AD. The Romans named the region Palestine.
The Arabs invaded the Middle East and claimed Jerusalem as a holy city for the Muslims even though it had been a Jewish holy city for decades. During this time Arabs occupied land with the Jewish people and some inhabitants of the tribes in the region converted to Muslim. Other countries took possession of the land up until World War 1 when after the defeat of the Ottoman Empire fell under the guidance of the English.
The English had made promises to the Arab leaders give the region to them. Palestinian people have resented the Immigration of Jews back into the region for years. Zionism on the part of the Jews took effect in 1800s and after many wars; Israel was recognized as a nation in 1948 by most of the world. The Palestinian movement started in 1957 and has engaged or caused skirmishes since. The problem seemed to be resolved when Israel relinquishes the Gaza Strip and West Bank to the Palestinians but Muslim sentiment is destruction of all Jewish people and until one side is wiped out completely the conflict will not end. Palestinians have claims to the lands the same as Israel and the inhabitants of the region has changed depending on the ruling country. The Palestinian side goes deeper though because they are supported by the Muslim Arabs and they all want more than.