Palestinians accused Israel of assassinating a senior security official in a car blast in Gaza today that cast a shadow over efforts to arrange talks aimed at ending more than 11 months of bloodshed.
A senior Israeli political source denied any Israeli involvement in the death of Taiseer Khatab, director of the office of Palestinian Intelligence Chief Amin al-Hindi.
Palestinian officials said Mr Khatab was killed and two people were wounded in the blast that threw body parts into the street. Blood stained the car seats and road.
Israel is behind Mr Khatab's assassination. He was personally targeted, the head of Palestinian West Bank intelligence, Tawfiq al-Tirawi, told reporters.
The Israeli source said it was not in Israel's interests to kill Mr Khatab, whom he described as someone who was trying to put an end to the violence . He suggested the killing stemmed from an internal Palestinian power struggle.
Hundreds of Palestinian security men took part in Mr Khatab's funeral in Gaza. Policemen fired in the air and some held signs reading Fatah will avenge your death .
Fatah, led by Palestinian President Yasser Arafat, is the main faction in the Palestine Liberation Organisation.
At least 548 Palestinians and 157 Israelis have been killed since a Palestinian uprising against Israeli occupation erupted last September after peace talks froze.
Meanwhile on the sidelines of a UN racism conference in South Africa, the German and Italian foreign ministers held talks with Mr Arafat to discuss a possible meeting between him and Israeli Foreign Minister Shimon Peres.