Israel today threatened more attacks on Palestinian militants after its killing of a Hamas leader led major Islamic groups to declare an end to a truce vital for a US-backed "road map" to peace.
In a bid to defuse the powder keg crisis, Washington turned for help to Mr Yasser Arafat, the Palestinian president it has shunned in favour of reformist Prime Minister Mr Mahmoud Abbas.
"This is only the beginning," a senior Israeli security source said a day after an Israeli helicopter strike killed Hamas leader Mr Ismail Abu Shanab and two bodyguards in Gaza.
"We plan serious retaliation on the terrorist infrastructure," he said, referring to a Hamas suicide bombing that killed 20 people on a Jerusalem bus on Tuesday.
US Secretary of State Mr Colin Powell urged Mr Arafat to work with Mr Abbas and to make available "those security elements that are under his control so that they can allow progress to be made on the road map - end terror, end this violence".
The appeal implicitly acknowledged Mr Arafat retains influence and Mr Abbas may not have enough clout to stop attacks on Israel.
Tens of thousands of Gazans, turned out for the funeral of Mr Abu Shanab, a US-educated engineer seen by Palestinians and independent analysts as a moderate in the militant group and by Israel as a terrorist.
Hamas, which said it carried out the Jerusalem bombing as payback for Israeli attacks, declared it would avenge Mr Shanab's assassination by striking in every corner of Israel.
In what it called an initial response, Hamas lobbed more than a dozen mortar bombs at Jewish settlements in Gaza and at least two of its makeshift Qassam rockets hit homes in Sderot, a town in southern Israel. There were no reports of casualties.