A senior Hamas official has said the group could declare a 10-year truce with Israel if the Jewish state withdrew from territory occupied since 1967.
Abdel-Aziz al-Rantissi told journalists late last night that Hamas had come to the conclusion that it was "difficult to liberate all our land at this stage, so we accept a phased liberation".
"We accept a state in the West Bank, including Jerusalem, and the Gaza Strip. We propose a 10-year truce in return for [Israeli] withdrawal and the establishment of a state," he said in a telephone interview from hiding in the Gaza Strip.
His comments appeared to strengthen signs of a big political shift by a faction sworn to destroy Israel and now seeming to move closer to the aims of Yasser Arafat's Palestinian Authority.
But Israel dismisses any talk of Hamas moderation as a smokescreen for military preparations by a group at the forefront of suicide bombings.
The spiritual leader of Hamas, Sheikh Ahmed Yassin, said recently the group could accept a Palestinian state in the West Bank and Gaza Strip - territory occupied by Israel in the 1967 war, but he gave no indication how long that might ensure peace.
Israeli officials also say it would be impossible to return to pre-1967 borders, emphasising that the Palestinians could not expect to get East Jerusalem, some major Jewish settlements or other land deemed vital for security.
Rantissi said he did not expect Israel to respond favourably to the new suggestion, "when it has rejected the Palestinian Authority's offer for less land than what we are proposing".