Palestinian President Mahmoud Abbas today swore in a new government that will shut out Hamas and may lift a US-led aid embargo on the Palestinian territories.
As he appointed the new 13-member cabinet at 11am Irish time Mr Abbas also said armed Hamas groups were outlawed and vowed to prosecute them.
Mr Abbas sacked the Hamas-led government on Thursday after days of factional violence that left Hamas in control of Gaza, and his own Fatah faction in control of the West Bank.
A Hamas member stops a car to check for identification in northern Gaza
Hamas spokesman Sami Abu Zuhri said that Mr Abbas "unfortunately is involved in the American-Israeli conspiracy, along with some Arab parties, to bring down the Hamas movement.
"Hamas as a movement has ties and roots to the hearts of the Palestinians, and the resistance will continue and cannot be stopped," he said.
Ahead of swearing in his new government Mr Abbas issued decrees to bypass constitutional limits on his powers to establish the emergency administration. Officials said the decrees, issued last night, would allow Mr Abbas, who heads the secular Fatah, to keep a planned cabinet in place without parliamentary approval.
Mr Abbas named retired guerrilla chief and Fatah ally Abdel-Razak Yahya as interior minister - a post overseeing all Palestinian security forces.
"He's tough," a Palestinian official said of Yahya. "He believes security forces should not be involved in politics."
Mr Yahya cannot be expected to wield much clout in Gaza, now effectively a Hamas fiefdom. But his appointment could stave off infighting in the occupied West Bank, where Fatah holds sway and where Hamas has threatened reprisals for round-ups of its men.
Hamas ousted Fatah from the Gaza Strip last week, prompting Mr Abbas to dissolve the factions' coalition government and declare a state of emergency. Hamas has described Mr Abbas's actions as a "coup".
Under Palestinians law, the state of emergency is not to exceed 30 days, but it could be extended for another period of 30 days after winning the approval of two thirds of the parliament.
Hamas holds a majority in the Palestinian Legislative Council though Israeli arrests of its deputies makes it difficult to reach a quorum and hold decision-making sessions.
Hamas statement
That could enable Mr Abbas to keep the state of emergency in place longer. Some Fatah officials and US diplomats have argued that Mr Abbas could rule by decree for six months to a year ahead of new elections
Israeli Prime Minister Ehud Olmert has said that a new government to be led by Mr Abbas's choice for Prime Minister Salam Fayyad could be a partner for peace negotiations.
"Security of the citizen is the priority on the basis of the sovereignty of the law," Mr Fayyad, an economist, told Palestinians in a televised address.
The new government is also set to be supported by the US which might lift an aid embargo on Palestinians, in place since Hamas came to power.
"(The current situation) presents an opportunity that has not existed for a long time ... This opens opportunities," Mr Olmert said.
The Israeli Prime Minister said that the situation in the Palestinian territories had "become clearer" and that it would be "advantageous" for the Palestinians because Hamas was no longer a member of the government.
Palestinian President Mahmoud Abbas, second from left, newly-appointed Palestinian Prime Minister Salam Fayad, center, and the Interior Minister Abdel Razak Yehiyeh, left, pause during a swearing in ceremony at Mr Abbas's headquarters in the West Bank city of Ramallah today. AP
Mr Abbas sacked the Hamas-led unity government after Islamist forces routed Fatah in the Gaza Strip and began imposing a new order and making key security appointments.
Hundreds of Fatah supporters fled the Hamas-controlled Gaza Strip by land and sea yesterday and the Islamist group threatened to take its fight against Mr Abbas's forces to the West Bank, which Fatah controls.
Hamas official Sami Abu Zuhri said 150 Hamas supporters were "abducted" in the occupied West Bank in what he called acts of "real terrorism" by Fatah forces there.
"We will not stand handcuffed against these crimes in the West Bank. We will take all steps to secure an end to these crimes," he said.
The US consul-general who handles relations with the Palestinians said Washington would lift a ban on direct financial aid to the new emergency government, clearing the way for the European Union and Israel to follow suit.
Meanwhile, an Israeli energy company said it had cut back fuel supplies to the Gaza Strip today, increasing pressure on Hamas.