There were reports of celebrations on the West Bank, and at the time there was an urban legend that the footage of some Palestinians celebrating the attacks was faked, and that it was actually footage from the invasion of Kuwait. This was proven false shortly afterwards [1], and the media widely circulated that fact.
Photos of these Palestinian children were widely circulated shortly after the September 11, Terrorist Attacks. Allegedly, they are celebrating the attacks. German media analyzing the whole film highlighted that the surrounding area is relatively quiet, that the people celebrating only appear briefly and then quickly disappear, and that a single person in a white T-shirt (shown here in the background) appears to have incited the children. (Fair use of AP photo)
However, US media did not widely circulate European media reports (by the renowned German weeklies Spiegel and Stern, by the German public TV magazine Panorama and by the Swedish Dagens Nyheter) that while the footage was indeed correctly dated, reporters had at least in part staged the scene. One woman was quoted saying that she was offered a piece of pie for celebrating in front of the camera. It is unclear whether it was explained to the woman what she was supposedly celebrating. [1] The Panorama TV report which analyzed the full video footage noted (translated):
Moderate Palestinians and the Palestinian leadership quickly distanced themselves from any celebrations. A few days after the September 11th attacks, Yasser Arafat symbolically donated blood for victims of the attacks.
This woman said she was offered a piece of cake for celebrating in front of the camera. While this picture shows someone handing her the cake, the version which was widely distributed did not.\ (Fair use of AP photo)
Reports concerning five Israelis employed by the company Urban Moving Systems who photographed or videotaped the burning towers while smiling and dancing received relatively little media attention ([1], mirror: [1]). The men were later detained and deported. According to ABCNEWS, the FBI believed Urban Moving Systems may have been a cover operation for Israeli intelligence.