* Group says go-betweens to deliver weapons on Saturday
* Separatists killed more than 850 in four decades
* Democratic nationalism now on the rise in Europe
By Sonya Dowsett and Isla Binnie
MADRID, April 8 (Reuters) - Basque militant group ETA is to surrender its weapons to authorities on Saturday, drawing a line under more than four decades of armed struggle that gained it notoriety as one of Europe's most intractable separatist movements.
The orchestrated handover in the French city of Bayonne will not dissolve the group, which declared a ceasefire in 2011 after killing more than 850 people during a campaign for an independent state in northern Spain and southwest France.
But it will sever a link with an era of political violence in Western Europe, just as democratically-driven nationalism is stirring across the continent.
Scotland and the Spanish region of Catalonia are seeking referendums on independence, while Ireland's Sinn Fein has urged a vote on taking Northern Ireland out of Britain.
Anger among Basques at political and cultural repression under General Francisco Franco led to the founding of ETA (Euskadi Ta Askatasuna - Basque Country and Freedom) in 1959.
Following Spain's return to democracy in the 1970s, the Basque region gained more autonomy and the group's continued bombings and assassinations caused public support to wane.
ETA said in a letter to the BBC it had handed over its weapons and explosives to civilian go-betweens who will deliver them to authorities on Saturday.
But it is not clear how the process will be carried out or if it will receive the backing of the Spanish and French governments.
The Basque parliamentary spokesman for Spain's ruling People's Party, which has refused to negotiate with ETA and called for its full dissolution, said the handover was a final surrender after six years of broken promises.
"The ETA we've known up to now has gone forever," said Borja Semper outside the legislature in Vitoria-Gasteiz. "What remains to be done is to wipe out the hatred that ETA embedded in a large part of Basque society."
The group's surrendered arms may yet come to embody that challenge.
A government source said Madrid did not believe the group would hand over all its arms, while Spain's state prosecutor has asked the High Court to examine those surrendered for murder weapons used in unresolved cases.
Popular revulsion at the scale of violent attacks carried out by Islamist militants like ISIS, and effective crackdowns by Spanish and French police have also helped make ETA's brand of activism untenable, says Paddy Woodworth, journalist and author of 'Dirty War, Clean Hands', a book about ETA.
"It had ceased to be an attractive organisation to join," he told Reuters. "The whole left nationalist armed strategy that goes back to the 1960s ... has been shown to be bankrupt."
ETA's first known victim was a secret police chief killed in San Sebastian in 1968. Its last was a French policemen the group shot in 2010.
A year later it chose not to disarm when it called its truce, but has been severely weakened in the past decade after hundreds of its members were arrested in joint Spanish and French operations and weapons were seized.
In a symbolic gesture in 2014, ETA released a video showing masked members giving up a limited weapons cache to verifiers.
The remaining arsenal, while difficult to keep track of, probably contains hundreds of guns and much more explosive material, "maybe 20, 100 times more" than was consigned in the symbolic handover, Woodworth said.
The group's first revolutionary gesture was to fly the banned 'ikurrina', the red and green Basque flag, before the campaign escalated in the 1960s into violence that was brutally reciprocated by the Franco regime.
In 1973, ETA targeted Franco's heir apparent Luis Carrero Blanco by digging a tunnel under the road that he drove down daily to attend Mass. They packed the tunnel with explosives and blasted Blanco's car over a five-storey building, killing him instantly.
The assassination changed the course of history, as the removal of Franco's successor led to the exiled king reclaiming the throne and Spain's progress to a constitutional monarchy.
At the peak of the violence, attacks including a 1987 car bomb at a Barcelona supermarket, which killed 21 including a pregnant woman and two children, horrified Spaniards and drew international outrage.
ETA called a permanent ceasefire in March 2006, but it was shattered by a massive bomb attack at a parking lot at Madrid airport that December which killed two Ecuadorian immigrants.
ETA victim Gorka Landaburu, who lost his thumb and was left blind in one eye after a letter bomb detonated in his home in 2001, welcomed the disarmament and said lessons had been learned.
"This must never happen again in our country," he said, standing by the sea in the Basque resort of San Sebastian. "I hope no one ever picks up pistols and bombs to defend an ideology ever again." (Editing by Julien Toyer and John Stonestreet)