The deals, brokered by the United States, were signed on Tuesday at the White House, where Israeli prime minister Benjamin Netanyahu met Bahraini and Emirati officials.
Clutching Palestinian flags and wearing face masks for protection against the coronavirus, demonstrators rallied in the West Bank cities of Nablus and Hebron and in Gaza. Dozens also took part in a demonstration in Ramallah, home of the Palestinian Authority (PA).
Banners were displayed reading "Treason", "No to normalization with the occupier", and "The agreements of shame".
Palestinian demonstrator Emad Essa from Gaza said if people walk through the coastal enclave "you'll see hundreds of Gazan youth who have lost their legs and got crippled for life for just for merely protesting against the Israeli blockade".
"And in the West Bank and Jerusalem al-Quds, the Israeli bulldozers continue to demolish Palestinian homes and ethnically cleanse the Palestinians out of their villages and cities on a daily basis," Essa told Al Jazeera.
"That's just the tip of the iceberg of Israeli crimes against the Palestinians, and the UAE and Bahrain somehow chose to reward Israel for these crimes by making agreements with it. The deals are stains of shame on the forehead of those leaders who sold the Palestinian cause for a very cheap price."
Protesters trampled pictures of Netanyahu, US President Donald Trump, Bahrain's King Hamad bin Isa Al Khalifa, and Abu Dhabi Crown Prince Mohammed bin Zayed Al Nahyan before they were burned.
The ceremony in Washington, DC marked the first such significant agreement between Arab countries and Israel in a quarter-century.
PA President Mahmoud Abbas said that only Israel's withdrawal from occupied territories can bring peace to the Middle East.
"Peace, security, and stability will not be achieved in the region until the Israeli occupation ends," he said in a statement after the signing ceremony, condemned by Palestinians as a "betrayal" of their cause.
The Palestinian Unified National Command of Popular Resistance called for protests to reject the normalization deals. In a statement, it called for Friday to be considered "a day of mourning in which black flags are raised in all squares, buildings and homes".
Activists on social media launched the hashtag "Black Day" in Arabic to mark the two Persian Gulf states' official recognition of Israel.
Sami Abu Zuhri, a Hamas spokesman, said the Bahrain and UAE agreements would not bring Israel peace in the region. "Peoples of the region will continue to deal with this occupation as their true enemy," he said.
In Ramallah, the de facto capital of the PA, there was a small protest at which 200 people gathered in a central square.
Mohammad Mohanna, a Palestinian protester from Hebron, said: "We call on the UAE and Bahrain to backtrack from the agreement with Israel and go back to being supportive of the Palestinians in the same way we've always known them to be, and we wish no other Arab country would ever make an agreement with Israel.
"At a time where companies in the West are boycotting Israel, two Arab countries are about to make trade agreements with it."
The secretary of the central committee of the Fatah Party, Jibril Rajoub, told reporters "what is happening today in Washington is a form of collapse of the official Arab order".