The Israeli leadership has accused the Palestinians of doing nothing to prevent militant attacks. Prime Minister Ariel Sharon says he has told the army to take “any action” necessary to stop radical groups.
It is reported the Israeli army could resume targeted killings and set up what it describes as “security zones” in the Gaza Strip.
Sharon has already broken off ties with newly appointed Palestinian President Mahmoud Abbas in response to a deadly strike on a border crossing.
The upsurge in violence has seen repeated mortar and rocket attacks on Jewish targets in the Gaza Strip and Israeli towns nearby.
An Israeli woman and a seven year old boy were injured in the Netzarim settlement.
At the border area in southern Gaza two Palestinians were killed and ten others injured by Israeli tank and machinegun fire.
Four of those hurt were Palestinian children.
The chaotic scenes and deadly clashes have undermined Abbas’ call for both sides to remain calm and work towards a truce.
The 69-year-old, fresh from his inauguration yesterday, says he is going to meet with militant leaders this week to try to finalise a mutual list of conditions for a ceasefire.
It will be a tough challenge, with radical leaders refusing to talk peace until Israel withdraws.