Aug 2 (Reuters) - Israel's supreme court ordered the evacuation of a hilltop outpost where some 250 Jewish settlers live without further delay on Tuesday, upholding a petition made by Palestinians and an anti-settler group over five years ago.

The court said the hilltop outpost of Migron in the occupied West Bank had to be removed by March 31, and the state could not drag its feet over the removal of the outpost which even it admits is illegal.

An official summary of the ruling said the petition was presented at the end of June 2006, when the court was asked to order the state to remove the outpost that was built on privately-owned Palestinian land.

Even in its first response to the ruling in 2006, the state admitted that the outpost had been built on privately-owned land and that it should be removed, but (the state) asked for a reprieve to discuss an agreed solution, the summary said.

It added that after five hearings, and with no agreed solution in the offing, the court found that there was no more justification to maintain the current illegal situation and the harm to Palestinians owners' rights.

As part of its commitments to a U.S.-backed peace road map with the Palestinians, Israel has agreed to dismantle outposts where construction has not been sanctioned by Israeli authorities.

But Israeli leaders have been reluctant to act because of opposition from settlers and their political backers.

Earlier this year settlers damaged houses and cars in two Palestinian villages after Israel demolished a small number of homes at Havat Gilad, another settler outpost in the West Bank.

Some 500,000 Israelis and 2.5 million Palestinians live in the West Bank and East Jerusalem, areas Israel captured from Jordan in the 1967 war and that Palestinians want for a future state together with the Gaza Strip.

Palestinians say the settlements will deny them a viable state and demand a total freeze in settlement building before renewing peace negotiations with Israel. (Writing by Ori Lewis; editing by Elizabeth Piper)