Katif was founded as a paramilitary Nahal settlement in 1973, and handed over to civilians in 1977. Some 70 families, or 330 people, including 220 children, lived in the moshav. A religious elementary school and a high school located there served many of the other settlements in the region. The economy was based on a plastics factory, a fabric factory, and agriculture, including a nursery and a dairy farm.
After their eviction, most of the families (forty-five) chose to move to a temporary refugee camp adjacent to Amatzia, a previously non-religious moshav of thirty-five families, and start planning their permanent settlement in the area.