In the 19th century, the Religious Society of Friends (Quakers) established a presence in Ramallah and built several schools for girls to alleviate the dearth of education for women and girls. Eli and Sybil Jones opened an academy for girls in 1869. A medical clinic was established in 1883, with Dr. George Hassenauer serving as the first doctor in Ramallah. In 1889, the girls academy became the Friends Girls School (FGS). As the FGS was also a boarding school, it attracted a number of girls from surrounding communities, including Jerusalem, Lydda, Jaffa, and Beirut. The Friends Boys School (FBS) was founded in 1901. The Quakers opened a Friends Meeting House for worship in the city center in 1910.
These Quaker schools, now known as the Ramallah Friends Schools, still exist today, in a co-ed format. According to the schools' official website, most high school students choose to take the International Baccalaureate exams instead of the traditional "Tawjihi" university exams.
The activity of foreign churches in Palestine in the late nineteenth century increased awareness of prosperity in the West. In Ramallah and Bethlehem, a few miles south, local residents began to seek their fortunes overseas. In 1901, merchants from Ramallah emigrated to the United States and established import-export businesses, selling handmade rugs and other exotic wares across the Atlantic. Increased trade dramatically improved living standards for Ramallah's inhabitants. American cars, mechanized farming equipment,radios, and later televisions became attainable luxuries for upper class families. As residents of Jaffa and Lydda moved to Ramallah, the balance of Muslims and Christians began to change.
By the beginning of the twentieth century Ramallah was an active agricultural town. It was declared a city in 1908 and had an elected municipality as well as partnership projects with the adjacent town of al-Bireh. In World War I, a few locals joined the Turkish army, a number of whom were killed in battle. The Friends Boys School became a temporary hospital during the War. The British Army occupied Ramallah in December 1917. The city remained under British rule until 1948.
The economy improved in the 1920s. The landed aristocracy and merchants who formed the Palestinian upper class built stately multi-storied villas during this period; many of these estates are still standing today. The Jerusalem Electric Company brought electricity to Ramallah in 1936, and most homes were wired shortly thereafter. In 1946, the British authorities inaugurated the "Palestine Broadcasting Service" in Ramallah, the staff of which was trained by the British Broadcasting Corporation to deliver daily broadcasts in Arabic, Hebrew, and English. This station was later renamed "Kol Yerushalaym" (The Voice of Jerusalem).
By 1953, Ramallah's population had doubled, but the economy and infrastructure were not equipped to handle the influx of poor villagers. They also feared the establishment of kibbutzim in Israel might engender a socialist-collectivist ideology among Palestinians and that their personal wealth might be confiscated and redistributed. Natives of Ramallah left, primarily to the United States. By 1946, 1,500 of Ramallah's 6,000 natives (or about a quarter) had emigrated, and Arabs from the surrounding towns and villages particularly Hebron, bought up the property and homes the émigrés left behind.
Unlike the Jordanians, Israel did not annex the West Bank. Ramallah residents did not have voting rights in Israel and could only work there by permit. Certain services, like banks, were not allowed in the West Bank and Gaza Strip. Ramallah remained under Israeli military rule for three decades. The Civil Administration established in 1981, was in charge of civilian and day-to-day services such as issuing permission to travel, build, export or import, and host relatives from abroad. The CA reprinted Jordanian textbooks for distribution in schools but did not update them. The CA was in charge of tax collection and land expropriation, which sometimes included olive groves that Arab villagers claimed to have tended for generations. According to the Israeli Human Rights activists, Jewish settlements in the Ramallah area, such as Beit-El and Psagot, prevented the expansion of the city and cut it off from the surrounding villages. As resistance increased, Ramallah residents were jailed or deported to neighboring countries for membership in the Palestine Liberation Organization. In December 1987, the popular uprising known as the Intifada erupted.
Ramallah residents were among the early joiners of the First Intifada. The Intifada Unified Leadership, an umbrella organization of various Palestinian factions, distributed weekly bulletins on the streets of Ramallah with a schedule of the daily protests, strikes and action against Israeli patrols in the city. At the demonstrations, tires were burned in the street and the crowds threw stones and Molotov cocktails. The IDF responded with tear gas and rubber bullets. Schools in Ramallah were forcibly shut down, and opened gradually for a few hours a day. House arrests were carried out and curfews were imposed that restricted travel and exports in what Palestinians regarded as collective punishment. In response to the closure of schools, residents organized home schooling sessions to help students make up missed material; this became one of the few symbols of civil disobedience. The Intifada leadership organized "tree plantings" and resorted to the tactics used in pre-1948 Palestine, such as ordering general strikes in which no commercial businesses were allowed to open and no cars were allowed on the streets.
In 1991, the Palestinian delegation to the Madrid International Peace Conference included many notables from Ramallah. As the Intifada wound down and the peace process moved forward, normal life in Ramallah resumed. On September 13, 1993 the famous White House handshake between Israeli Prime Minister Yitzhak Rabin and Palestinian Leader Yasser Arafat took place, and schoolchildren in Ramallah handed out olive branches to Israeli soldiers patrolling the streets. In December 1995, in keeping with the Oslo Accords, the Israeli army abandoned the Mukata'a and withdrew to the city outskirts. The newly established Palestinian Authority assumed civilian and security responsibility for the city, which was designated "Area A" under the accords.
The years between 1995 and 2000 (known locally as the "Oslo Years") brought relative prosperity to Ramallah. Many expatriates returned to establish businesses there and the atmosphere was one of optimism. In 2000, unemployment began to rise and the economy of Ramallah declined. The Israel Defense Force remained in control of the territories, the freedom of movement enjoyed by Ramallah residents prior to the first Intifada was not restored. Travel to Jerusalem required special permits, and expansion of Israeli settlements around Ramallah increased dramatically. A network of bypass roads for use of Jewish residents was built around Ramallah, and land was confiscated for settlements. Many official documents previously handled by the Israeli Civil Administration were now handled by the Palestinian Authority but still required Israeli approval. A Palestinian passport issued to Ramallah residents was not valid unless the serial number was registered with the Israeli authorities, who controlled border crossings. The failure of the Camp David summit in July 2000 led to the outbreak of the Al-Aqsa Intifada in September 2000.
Young Ramallah residents demonstrated daily against the Israeli army, with marches to the Israeli checkpoints at the outskirts of the city. Over time, the marches were replaced by sporadic use of live ammunition against Israeli solders, and various atrocities against Jewish citizens. A number of Jewish settlers were also targeted, particularly on the bypass roads. Army checkpoints were established to restrict movement in and out of Ramallah.
On October 12, 2000, two Israeli army reservists took a wrong turn near Ramallah and were set upon by an angry mob. According to the Palestinian police chief, attempts were made to shield them from harm at the Ramallah police station, but a frenzied crowd stormed the station, killed the two reservists, mutilated their bodies, and dragged them through the streets. Later that afternoon, Israeli army carried out an air strike on Ramallah, demolishing the police station. In subsequent months, Palestinians resorted to increased use of firearms to target Israeli soldiers and Jewish settlers, and suicide bombers attacked Israeli civilians in Jerusalem, Tel Aviv, and elsewhere. Some of the bombers came from villages and refugee camps around Ramallah.
In 2002, Ramallah was reoccupied by Israel in an IDF operation codenamed Operation Defensive Shield, which resulted in curfews, electricity cuts, school closures and disruptions of commercial life. Many Ramallah institutions, including government ministries, were vandalized, and equipment was destroyed or stolen. The IDF took over local Ramallah television stations, and social and economic conditions deteriorated. Many expatriates left, as did many other Palestinians who complained that the living conditions had become intolerable. The Israeli West Bank barrier has furthered Ramallah's isolation.
Yasser Arafat established his West Bank headquarters, the Mukata'a, in Ramallah. Although considered an interim solution, Ramallah has become the de facto capital of the Palestinian Authority, hosting almost all governmental headquarters. In December 2001, Arafat held meetings at the Mukata'a, but lived with his wife and daughter in Gaza City. After suicide bombings in Haifa, Arafat was confined to the Ramallah compound. In 2002, the compound was partly demolished by the IDF and Arafat's building was cut off from the rest of the compound. Israel showed pictures of illegal weapons allegedly found in the Mukata'a and said it proved Arafat's link to terrorism. The Palestinians claimed the weapons belonged to the Palestinian security services.
On November 11, 2004 Arafat died at the Percy training hospital of the Armies near Paris. He was buried in the courtyard of the Mukata'a on November 12, 2004. The site still serves as the Ramallah headquarters of the Palestinian Authority, as well the official West Bank office of Mahmoud Abbas.
In December 2005, local elections were held in Ramallah in which candidates from three different factions competed for the 15-seat municipal council for a four-year term. The council elected Janet Mikhail as mayor, the first woman to hold the post.