What happened is, they had an election, and Hamas won a given amount of seats (IIRC a slim plurality). This resulted in a variety of fighting and scandals, but the long and the short of it was that Hamas ended up in control of Gaza, and FATAH and the more moderate types control TWB. Gaza is in a state of semi-starvation and Hamas is constantly becoming more and more idiotic in its form of governance. TWB is vaguely saner, if third-worldish, and actually maintains a degree of economic growth (if in part due to Western and Israeli aid). They have a variety of subgroups running around and executing random attacks (shootings, knife attacks, etc.) on soldiers and settlers, but the leadership actually does a semi-decent effort of putting it under control.
Hamas used to be firing a lot of rockets, but they've effectively stopped a few months after Operation Cast lead, which caused the flow of said rockets to come down to a trickle (they're fired by a variety of rogue groups). It seems from here the only real bargaining cards Hamas has left are Gilad Shalit, and the threat to fire their rockets if we invade Gaza again. Their major plan seems to be to gradually tee off everybody who doesn't hold a Hamas membership card.