A Palestinian suicide bomber killed nine people and wounded 60 others in the Israeli city of Tel Aviv today in an attack a spokesman for the Islamic militant group Hamas called an act of "self-defence".
The Israeli government of acting Prime Minister Ehud Olmert said it held the new Hamas-led Palestinian Authority responsible for the bombing, which was claimed by two separate Palestinian militant groups.
Mr Olmert said he was weighing a response.
The bombing occurred at a sandwich stand near Tel Aviv's old central bus station in the middle of the week-long Jewish holiday of Passover. Medics put the number killed at eight, not including the suicide bomber.
"I am beyond despair," said Asher Bracha, 46, the owner of a small market two doors from the shop that blew up.
"I heard a deafening blast. I knew it was another attack."
Both the Islamic Jihad militant group and the al-Aqsa Martyrs Brigade, which is linked to the Fatah movement of Palestinian President Mahmoud Abbas, claimed responsibility.
Mr Abbas, a moderate, condemned the bombing, as did the United States.
"It is a despicable act of terror for which there is no excuse or justification," White House spokesman Scott McClellan said.
The bomber struck as Olmert was trying to form a coalition after his Kadima party won most seats in general elections late last month and three weeks after Hamas took over the Palestinian Authority following its own election win in January.
It was the first suicide bombing inside the Jewish state to kill Israelis since Mr Olmert took over from Ariel Sharon, who was incapacitated by a massive stroke in early January.
Witnesses said they saw the male bomber.
"I saw a young guy, who was carrying a blue bag. He was stopped by a security guard who asked what was in the bag. He opened the bag and everything went up in the air," witness Moussa al-Zedad told Reuters Television on the scene.
Live television pictures showed bystanders with blood on their shirts immediately after the attack. The sandwich shop was wrecked while pools of blood lay on the ground outside. Three cars were also damaged.
Mr Olmert said Israel would respond appropriately.
"We will know how to respond in the way and manner required, and we will continue to act with all means at our disposal to thwart further such incidents," he said.
An Olmert spokesman, Raanan Gissin, said the government held the new Palestinian Authority responsible.