Israel on Tuesday waved in a new period of military pressure against the Palestinians, its troops on high alert following the first suicide bombing within its borders since Hamas shot to power.
Prime minister designate Ehud Olmert authorised the army to step up its activities but stopped short of ordering a full-scale operation after Monday's blast killed nine people at a crowded Tel Aviv food stand, public radio said.
The bombing carried out by a 21-year-old Palestinian from the Islamic Jihad faction failed to elicit condemnation from Hamas, which formed its first Palestinian Authority government last month.
Despite sharp international criticism over Hamas's failure to take a stand, likely only to heighten international isolation of the Palestinian Authority, various armed factions demanded that Palestinian leader Mahmud Abbas apologise for his fierce condemnation of the suicide bombing.
Following talks with ministers and security chiefs, Olmert gave the army the green light to carry out targeted killings against "all those involved in terrorism", including Hamas and Palestinian government officials, radio said.
Senior government sources said three Hamas members would be stripped of their right to reside in annexed east Jerusalem but added that the move would not lead to their expulsion to the West Bank.
Israeli authorities would also harden restrictions on illegal Palestinian workers in Israel and those who drive them to their jobs, and seal even more hermetically the borders with the Gaza Strip and West Bank, the radio added.
Troops had already arrested the father of the bomber while a further 38 Palestinians were also rounded up overnight, security sources said.
Speaking on public radio, however, Public Security Minister Gideon Ezra refused to give any details about Tuesday's talks after what was the first attack in Israel since the new Hamas-led Palestinian government came to power.
Israel, already on a state of high alert for the Jewish Passover festival, has deployed reinforcements on all major highways and the border with the occupied West Bank, where the 21-year-old Islamic Jihad suicide bomber lived.