Israel has killed four Palestinians in a missile strike and gun battle in the Gaza Strip.
The latest bloodshed deepened doubt as to whether Hamas, the main militant group behind a campaign of suicide attacks against Israelis, would soon call a "hudna", or temporary truce.
Witnesses said missiles crashed into two cars near Khan Younis in southern Gaza, killing two Palestinians including a woman and wounding their apparent target, a Hamas operative.
An Israeli army spokesman said a helicopter fired two missiles to take out a "Hamas terrorist cell on its way to firing mortar shells into Israeli communities" - most likely Jewish settlements in the Mediterranean strip.
Military sources said the large explosion of one of the cars hit confirmed intelligence that it was laden with mortars.
Hospital sources said the militant, Mohammed Seyam, had his leg amputated in hospital. Palestinian security sources said Seyam was on Israel's wanted list and that he was in one car while the two people killed were in the other, a taxi.
Political leaders of the Islamist groups denied media reports they had tentatively decided to suspend attacks after talks with Palestinian Prime Minister Mahmoud Abbas and said Israel's military action would not help calm the situation.
Hamas's military wing, the Izz al-Deen al-Qassam Brigades, said the missile attack was "clear evidence that the criminal occupier does not want to achieve the calm it claims to be seeking. We will not stand by handcuffed. On the contrary we will respond to such crimes".
But aides to Israeli Prime Minister Ariel Sharon said Israel had the right to pursue militants plotting attacks in the absence of a crackdown on them by the new reformist Palestinian leadership.
Israeli troops also killed two Hamas fighters in a gunfight not far from where US envoy Mr John Wolf met Mr Abbas to try to move ahead on the road map envisaging a Palestinian state by 2005.