Not only has his Hamas movement which runs Gaza gained popularity among Palestinians from a recent war with Israel, it has begun to overcome its pariah status after uprisings brought like-minded Islamists to power across the Arab world.
Mashaal, 56, is at the top of his game despite decades in exile and sees Hamas leading the struggle for freedom from Israeli occupation of Palestinian lands including East Jerusalem and the West Bank, now run by his secularist Fatah rival.
Although over 170 Palestinians were killed in the eight-day conflict with Israel last month, including the military mastermind of Hamas, Mashaal won plaudits from Palestinians in both Gaza and the West Bank for standing up to their foe.
He says he is shielded by the international involvement in the ceasefire he negotiated.
"Israel always violates agreements but Israel will be condemned if it doesn't abide by this written agreement under Egyptian sponsorship and US presence," he told Reuters last week, referring to the ceasefire deal, which stipulated ending targeted assassinations.
"The world witnessed it," he said.
Armed men lined up in Gaza nevertheless on Friday to greet the man whose ear was injected with poison by Mossad agents in Amman in 1997 before Jordan made Israel hand over the antidote.
Mouin Rabbani, an expert on Palestinian affairs, summed up the Palestinian view of Mashaal's first visit to his homeland since leaving the West Bank aged 11. "It is a very welcome poke in the eye of Israel," he said.
"It is a significant visit that shows Israel's position in Gaza has further weakened to the extent that the leader of the organization it went to war with last month and it tried to murder can now visit Gaza with the trappings of an official visit."
When he appeared alongside President Muhammad Mursi of Egypt in Cairo after the ceasefire agreement, Mashaal's confident and relaxed body language would have confused any casual observer as to which one of them was the leader of Egypt.
As the conclusion of the eight day conflict demonstrated, Gaza is slowly breaking out of the isolation imposed by Israel's economic and military blockade and by being diplomatically black-balled by nearly all Western powers.
In the reconfiguring Arab world, a procession of high level visitors have made their way there, starting with the Emir of Qatar Sheikh Hamad bin Khalifa al-Thani, the first Arab ruler to break the teeming territory's physical and diplomatic isolation.
Mashaal was also a guest of honor, alongside Mursi, at a recent congress of the Islamist-rooted Justice and Development Party, Turkey's ruling party.
The question now is whether recognition in the Arab and Muslim world can make Hamas an interlocutor for Western powers and Israel, which view it as a terrorist organization aided by the theocracy in Iran.New Arab order
Mashaal said he does not fear Israeli Prime Minister Benjamin Netanyahu, who ordered the 1997 assassination attempt and was then forced by an incensed Jordan to hand over the antidote to poison which had been injected in broad daylight.
"He tried to kill me but the God who protected me then will protect me now and in the future," Mashaal said in the interview. "The one with a cause doesn't fear death. I ask God to grant me martyrdom on the land of Palestine."
He also said new factors play in Hamas' favor.
First and foremost, he said, was the military readiness of Hamas, which surprised Israel after the state assassinated Hamas military leader Ahmed al-Jaabari last month.
"The response of the resistance came in the first 24 hours by hitting Tel Aviv and Jerusalem with rockets," he told Reuters in Qatar, where he has set up home since leaving Syria earlier this year.
A grey-bearded, articulate speaker who regularly cites Quranic verses, Mashaal said his movement had been reenergized by the Arab Spring, which brought the Muslim Brotherhood it is rooted in to power in Egypt.
"There is a new and different Arab presence, there is a different kind of support. Gaza did not seem isolated in this war," Mashaal said, as it was in the devastating 2008-09 conflict with Israel.
The immediate purpose of Mashaal's visit is to mark the foundation of Hamas - the Palestinian chapter of the Brotherhood -- at the outbreak of the first Intifada in 1987.
As a leader in exile, he also wants to bolster his position among the Palestinians in general and within Hamas following friction between him and the Gaza leadership over his attempt to promote reconciliation with President Mahmoud Abbas, leader of the Palestinian Authority and of the rival Fatah nationalists.'Victory day'
In Mashaal's view, the visit also celebrates what he regards as a victory against Israel in eight days of fighting last month which killed six Israelis along with over 170 Palestinians.
Militarily, the Palestinians of Gaza got the worst of it as they always do against Israel's overwhelming force. Yet politically and diplomatically Hamas believes it came out ahead.
Despite assurances he must have obtained from Israel for his visit, Mashaal believes Hamas's "sustained and robust" retaliation for the killing of al-Jaabari is the only insurance he has that Israel will not seek to eliminate him while he is in Gaza, where it has assassinated a string of Hamas leaders.
"I believe the circumstances are ready to visit Gaza. I am delighted and honored to be present on this pure land which has been soaked with the blood of our martyrs and leaders," he said.
Under Mashaal's leadership, Hamas has evolved an uneasy balance between maximalism and pragmatism - refusing to renounce pre-1948 "Palestine", but willing to accept de facto a state on the lands Israel captured in the 1967 Six Day War - the West Bank including East Jerusalem and Gaza -- as a temporary solution.
The Islamist leader says Israel will give nothing in negotiations unless Palestinians show strength on the ground.
"Our battle with the Israeli leaders, with the Israeli army and with the settlers is a long and open battle until the end of the occupation and settlements and until we regain our land and our rights God willing," he said.
Many analysts of this intractable conflict believe Hamas and Fatah are being pushed together - despite a short and vicious civil war that led to Fatah's ejection from Gaza in 2007 after Hamas won general elections the previous year.
That is because many Palestinians say President Abbas's negotiation strategy has not brought them closer to an independent state, despite de-facto recognition at the United Nations this month.
"Any Palestinian who wants a Palestinian state, even along the 67 borders, has to know that the road to that is (armed) struggle. Negotiating without powerful cards on the ground has no meaning. It will turn into begging. This enemy doesn't give anything unless under pressure," Mashaal said.
Since its foundation in 1987, Hamas has opposed deadlocked peace process and acted as a rival to Fatah in leading the Palestinians in their drive to end Israeli occupation and set up a Palestinian state.
But Netanyahu's decision last week to expand settlement building in the West Bank and East Jerusalem after the United Nations move could bring Hamas and the Palestinian Authority closer to reconciliation.Bigger role
Mashaal has pledged to give up his post as leader of Hamas, which has been holding a leadership ballot for several months to decide who will succeed him as its political leader.
But those who closely follow this highly political animal say he might be persuaded to stay on by powerful allies like Egypt and Qatar, or he might quit to ultimately seek a bigger and broader role as the leader of all the Palestinian people.
"Mashaal's goal is to turn Hamas into the leading force in the entire Palestinian national movement, not just Gaza," said Rabbani, the expert on Palestinian affairs.
"His focus is much more on him or one of his successors becoming the eventual leader of the Palestine Liberation Organization executive committee rather than being prime minister of Gaza," he said.
Mashaal took over as Hamas leader following the 2004 assassinations of Abdel-Aziz al-Rantissi and Sheikh Ahmed Yassin, the movement's founder. With both of them killed in Gaza, Mashaal has led Hamas from the relative safety of exile.
On Mashaal's watch, Hamas has emerged as an ever more important player in the Middle East conflict with broader regional reach. It weakened the US-backed Palestinian Authority by seizing control of Gaza in 2007, challenging its strategy of negotiating peace with Israel and promoting an alternative approach based on armed struggle.
The son of a local Imam, Mashaal, who now has seven children and six grandchildren, left Silwad village in the West Bank during the 1967 war with his family for Jordan and then Kuwait.
He joined the Brotherhood at 15 at a Kuwait school where he met Brotherhood members from Gaza and went on to study physics at Kuwait University, work as a teacher and become a founding member of the undeclared Hamas leadership set up in Kuwait. He returned to Jordan in 1990 following Iraq's invasion of Kuwait.
(Reuters) -- Fifteen years after Israel tried to assassinate him in Jordan, Islamist leader Khalid Mashaal says Israel would not risk trying again on his triumphant return to Palestinian land.