Palestinian refugees are beginning to return to a Damascus camp they fled late last year, a Palestinian group in Syria says.

Two Palestinians were shot dead by snipers in Yarmouk on Sunday, and three others in Deraa in southern Syria, the Palestinian workforce in Syria said.

Despite this, a large number of Yarmouk residents returned to certain areas of the Yarmouk camp on Sunday morning, a spokesman for the group said.

In December, heavy fighting broke out in Yarmouk between Syrian rebels and the army, causing Palestinians to flee.

PLO leaders say they are working on a deal to demilitarize the camp with the Free Syria Army and Syrian government forces.

Syria hosts half a million Palestinian refugees, descendants of those admitted after the creation of Israel in 1948.