Pope Benedict has prayed for peace as he delivered his traditional Christmas Eve homily in Rome.
At a Mass at St Peter's Basilica, the Pope prayed for God to "implant his peace in our hearts" but also to "break the rods of the oppressors".
Security was tight. Last year at the same Mass a woman jumped the barriers and lunged at the Pope.
Meanwhile at a Mass in the West Bank town of Bethlehem, a senior cleric called for peace in the Middle East.
'Garments rolled in blood'
The BBC's David Willey in Rome says plain-clothed security men followed the Pope as he walked in procession up the central nave of the basilica watching for any sign of trouble.
The 83-year-old pontiff stopped twice to bless babies held up to him.
About 10,000 people attended the Mass.
The Vatican had reviewed its security procedures after last year's incident. The same woman had also attempted to throw herself at the Pope at the Mass a year earlier.
The Pope lit a nativity candle from his window
Security concerns had also been heightened by parcel bomb attacks on Thursday at two embassies in the Italian capital which injured two people.
In his Christmas homily, Pope Benedict said: "We are grateful that God gives himself into our hands as a child, begging as it were for our love, implanting his peace in our hearts.
But this joy is also a prayer: Lord, make your promise come fully true. Break the rods of the oppressors. Burn the tramping boots. Let the time of the garments rolled in blood come to an end."
He added: "Help us to live together with you as brothers and sisters, so as to become one family, your family."
Earlier in heavy rain the Pope had lit a candle in his window, which overlooks St Peter's Square, to open officially the Vatican's nativity scene.
One American tourist, Gayle Savino, told Reuters: "It's just a blessing to be here on such a wonderful night on Christ's birthday."
Later on Saturday, the Pope will deliver his Christmas message to the city of Rome and the world.
Then he will host a Christmas lunch in the Vatican's audience hall for 350 homeless people.
'Model for the world'
Thousands of people also converged on the West Bank town of Bethlehem ahead of the midnight Mass at the Church of the Nativity - built at the site where Christians believe Jesus was born.
Some 90,000 people are expected to visit Bethlehem for celebrations there
It was addressed by the Catholic Church's top representative in the Middle East - Latin Patriarch of Jerusalem, Fouad Twal - who made his traditional call for peace.
"During this Christmas season, may the sound of the bells of our churches drown the noise of weapons in our wounded Middle East," he said.
"Our hope for Christmas is that Jerusalem not only becomes the capital of two nations, but also a model for the world, of harmony and coexistence of the three monotheistic religions."
The patriarch also recalled October's bloody attack on Christians in a Baghdad church.
"Such fanatic actions are universally condemned by Christians and Muslims," he said.
More than 50 people were killed when security forces stormed the church to free dozens of hostages.
The number of tourists visiting Bethlehem has been rising in recent years as violence has decreased.
Some 90,000 visitors are expected in the town during the Christmas season - up from about 70,000 last year, according to Israeli government figures.