Israeli troops and Palestinians fought a fierce gun-battle today, as Israeli Prime Minister Mr Ariel Sharon returned from the United States adamant he would not negotiate until violence ends.
Mr haron said Israel would not be the one to pay the price for stability in the Middle East, and went straight into talks with security chiefs at Tel Aviv airport.
As fighting raged, Israel's ambassador in Cairo said Israel had asked Egypt to do what it can to stop almost six months of bloodshed and ensure an Arab summit in Jordan next week does not take a hard line against the Jewish state.
At least six people were reported hurt in several hours of shooting at Khan Younis refugee camp in southern Gaza. Palestinians accused Israeli soldiers of firing tank shells during the clash and the army said Palestinians had used armour-piercing grenades.
Witnesses said Palestinian gunmen had opened fire on an Israeli army bulldozer clearing land on the edge of the refugee camp. An Israeli spokesman said the bulldozer had been doing work on a defence post next to a nearby Jewish settlement.
Palestinian witnesses said two gunmen had been wounded by Israeli tank shells. The army denied firing tank shells.
The fighting at Khan Younis, one of the main flash-points in the Palestinian uprising, erupted one day after a fact-finding committee led by former U.S. Senator George Mitchell toured the area.
In the more peaceful West Bank today, Mitchell heard harrowing testimony from families of Palestinians killed in the conflict, and Palestinian officials urged Mitchell to ignore suggestions by Israeli Foreign Minister Shimon Peres that Mitchell's final report should avoid apportioning blame.
Obviously there is a guilty party and there has to be culpability, said lawmaker Hanan Ashrawi. Mr Mitchell told reporters today that the committee had reached no conclusions so far.