Hamas vowed last night to "cut off" the head of Prime Minister Mr Ariel Sharon as Israeli security chiefs put the country on heightened alert after Israeli helicopters yesterday assassinated Sheikh Ahmed Yassin, the founder and spiritual leader of the radical Islamic group.
Seven other people, including some of Yassin's bodyguards and his son-in-law, were also killed in the strike.
Hundreds of thousands of Palestinians, many chanting "revenge, revenge," joined the funeral procession of Yassin (67), who was the most prominent Palestinian to be killed by Israel since the start of the intifada in September 2000.
Israel showed it was braced for reprisals when it moved armoured tanks into the northern Gaza Strip after rocket attacks last night.
The decision to target the wheelchair-bound cleric drew criticism from European and Arab capitals. The White House said it was "deeply troubled" by the attack, but refrained from directly condemning Israel.
Mr Sharon called Yassin a "terror mastermind", and won backing from most of his ministers. However, some politicians, including two ministers, questioned the wisdom of the strike.
There were also reports last night that the head of Israel's internal security service had opposed the operation.
Four other Palestinians were killed in clashes with troops which erupted after the assassination, and militants last night fired home-made mortar shells at Israeli targets in the Gaza Strip. There were no injuries. Hizbullah also responded to the killing, firing at Israeli military outposts in a disputed area along the Israel-Lebanon border.
Inside Israel, three Israelis were stabbed and slightly injured on a bus in the town of Jaffa, near Tel Aviv, while earlier in the day an axe-wielding Palestinian attacked three people in a Tel Aviv suburb, inflicting moderate-to-serious injuries on one of them.
Both attacks appeared to be linked to the Yassin assassination.
An Islamist website published a statement last night purporting to come from an al-Qaeda-linked group, which claimed responsibility for the Madrid bombings on March 11th, vowing revenge on the US and its allies over the assassination.
The strike in Gaza came at dawn yesterday when Israeli helicopters fired three missiles at a car carrying Yassin and his bodyguards. The Hamas leader had just completed morning prayers at a mosque in Gaza City.
Palestinians flocked to the scene. Blood and flesh were splattered on the path, and all that remained of Yassin's wheelchair were two mangled wheels and a seat.
The Palestinian Authority announced a three-day mourning period, and flags were lowered to half-mast at the Ramallah compound of Palestinian President Mr Yasser Arafat. Yassin was Mr Arafat's main political rival.
Hamas leaders warned that Mr Sharon had "opened the gates of hell and nothing will stop us from cutting off his head".
Mr Ismail Haniyeh, a senior movement official in Gaza, vowed that "the enemy should expect a response that will turn the ground under his feet to hell....All of Palestine will turn into a volcano that will burn up the enemies."
The group, which does not recognise Israel's right to exist and has been behind dozens of suicide bombings, also issued a call to Muslims around the world "to join in on the retaliation for this crime".
Israel tried to assassinate the Hamas leader in September, but Yassin emerged from that strike with light injuries.
Mr Sharon, speaking at a party meeting in the parliament, said Israel had a "natural right" to pursue those trying to destroy it.
Yassin's ideology, he added, "was killing and murdering Jews", and he vowed that "the war against terror will continue day after day".