Israeli soldiers besieging Palestinian President Yasser Arafat's headquarters fired on his offices today and entered nearby rooms, a senior Palestinian official said.
Israeli military sources denied the army had entered the building where Mr Arafat is holed up and said troops had returned fire when Palestinian gunmen shot at them from elsewhere in the compound in the West Bank city of Ramallah.
Palestinian information minister Mr Yasser Abed Rabbo said soldiers had "started entering Mr Arafat's offices and now they are exchanging fire with the president's bodyguards. There are very serious clashes and the president's guards are fighting against the invaders. There are several wounded."
Israeli foreign minister Mr Shimon Peres said the government had not decided to enter Arafat's offices even as the army kept up pressure at his headquarters to root out militants after a fresh wave of Palestinian bombing attacks.
"Our decision is not to hurt Arafat," Mr Peres told Israel Radio after the reported entry of troops. "We don't want to turn this into a world war or a regional war."
Mr Abed Rabbo was not inside the compound which houses several Palestinian Authority buildings, including Arafat's private quarters.
He said troops had not entered the room where Arafat was holed up but had taken control of adjacent rooms, including a dining room where most of the fighting took place.