Six Palestinians died yesterday in the heaviest clashes for years between supporters of Islamic extremist groups and policemen from Mr Yasser Arafat's Palestinian Authority, as Hamas announced that it was suspending suicide bombings inside Israel and mortar attacks on Israeli targets.
Hamas did not rule out attacks inside the occupied territories, however, and another extremist group, Islamic Jihad, said it would continue attacking Israelis wherever it could.
But late last night a senior Islamic Jihad official in Gaza, told Reuters the group would suspend suicide attacks against Israel to help prevent rifts within Palestinian society until it decided on a further course of action.
"There is thinking within the movement towards taking this path (freezing suicide attacks)," Mr Nafez Azzam, the official was reported as saying. "The issue will be decided finally by the leadership abroad, but we are moving towards that path."
The heavy fighting in Gaza's Jebalya refugee camp, and the unprecedented Hamas declaration, were a direct consequence of this week's heightened efforts by Mr Arafat to enforce an Intifada ceasefire. But Israel was divided in its assessment.
It dismissed the Hamas announcement as a "sham" and while the Foreign Minister, Mr Shimon Peres, said the Palestinian Authority was now making "an important effort to fight terrorism," the army's chief of staff, Gen Shaul Mofaz, said he detected "no strategic change" on Mr Arafat's part.
Mr Arafat has come under intense international pressure this month to smash Hamas and Islamic Jihad, the two fundamentalist groups responsible for the suicide bombings and other attacks inside Israel and across the occupied territories that have accompanied the now lapsed Oslo peace process almost since its inception in 1993. And the violence that erupted in Jebalya yesterday marked the Authority's most serious attempt at a crackdown since the mid-1990s.
The fatalities came as supporters of the Islamic groups were burying one of their members, a teenager who had been shot dead by one of Mr Arafat's security men a day earlier. Eyewitnesses say that gunmen in the funeral procession opened fire on a Palestinian police station, drawing return fire, and that a protracted gun-battle ensued, leaving six dead and 70 injured, 10 of them critically.
Hamas gunmen also clashed with Mr Arafat's forces in central Gaza's Dir al-Balah, and in the West Bank town of Tulkarm where they fired on Palestinian policemen who had intervened to stop them shooting at Israeli soldiers.
In Gaza City, meanwhile, Mr Arafat's forces are still trying to arrest a Hamas leader, Mr Abed al-Aziz al-Rantisi, who has used hundreds of supporters to repulse Palestinian security officials at his home. Aides to Mr Arafat have long complained that, were they to act decisively against the Islamic extremists - who reject the peace process and openly call for Israel's destruction - they would risk Palestinian civil war. And the formal Hamas pledge to end suicide bombings inside Israel was evidently designed to reduce that possibility.
Noting Hamas was still committed to attacks on Israelis in the West Bank and Gaza Strip, a spokesman for Mr Sharon made clear that Israel had no plans to halt its attacks on Hamas kingpins.
Earlier Islamic Jihad declared that it would continue its attacks, and urged all Palestinians to resist ceasefire efforts, accusing Mr Arafat of "selling out" Palestinian security for the sake of the Israelis.
In a graphic illustration of the sensitivity of Mr Arafat's position, several thousand Palestinians - representing various militant and political groups - marched to his Ramallah headquarters yesterday, demanding that he halt his crackdown on the Islamists.