Hamas has threatened a "volcano of revenge" against Israel as around 200,000 Palestinians packed the streets of Gaza for the funeral of the Islamic movement's assassinated leader Abdel-Aziz al-Rantissi.
His killing has prompted a chorus of international condemnation, except in the United States, and sparked anti-Israeli and anti-US protests in Arab countries such as Lebanon, Egypt, Jordan, Iraq, Kuwait and Tunisia.
US national security adviser Condoleezza Rice has denied any advance knowledge of the attack.
"The Israelis of course don't tell us that they're about to do something," she told Fox News.
The US Government has warned Americans in Jordan to stay away from the demonstrations, noting widespread suspicion that US officials had signed off on the slaying.
Dr Rantissi was killed when an Israeli helicopter fired rockets into his car in Gaza City, less than a month after Hamas spiritual leader Sheikh Ahmed Yassin was killed in a similar attack.
Fearing that Dr Rantissi's successor as head of the movement in the occupied territories could also be targeted by Israel, Hamas announced it had chosen a new leader, but his identity would not be disclosed for security reasons.
Israeli Prime Minister Ariel Sharon vowed the targeting of "the leaders of terrorist organisations" would continue, while one of his ministers warned that Hamas' Damascus-based politburo chief Khaled Meshaal, now the movement's undisputed number one, would meet "an identical fate".
A crowd of some 200,000 Palestinians took to the streets as close supporters carried Dr Rantissi's flag-draped body from Gaza City's Shifa hospital on a stretcher to his family home and then to the main Al-Omri mosque.
"When the opportunity presents itself, we will deliver a widescale response. It will come," top Hamas figure Mahmud al-Zahar told mourners.
Palestinian leader Yasser Arafat said in a statement he "vigorously condemned" the killing and phoned the Hamas leadership to offer condolences.
Ahead of the funeral, the Ezzedine al-Qassam Brigades vowed to "explode a volcano of revenge" in retaliation.
"Our revenge will come a hundredfold for the blood of Rantissi and Yassin," a statement said.
Israeli security services were put on a state of alert as they braced themselves for retaliation.
UN secretary-general Kofi Annan feared the assassination would "lead to further deterioration of an already distressing and fragile situation".
European Union foreign policy chief Javier Solana said the killing "will not facilitate a positive outcome of this process", while Pope John Paul II condemned an "inhuman act contrary to the will of God".
However the White House has refrained from condemning Israel, saying in a statement that it "has the right to defend itself from terrorist attacks".
Democratic presidential candidate John Kerry earlier said "Israel has every right in the world to respond to any act of terror against it," when asked about the assassination.
Palestinian prime minister Ahmed Qurie said US President George W Bush's enthusiastic endorsement of Mr Sharon's controversial disengagement plan last week, which will see Israel evacuate all the Jewish settlements in Gaza but stay put in most of the West Bank, had served to egg on Israel.
"This Israeli terrorist offensive is a direct result of America's encouragement and total bias in favour of Israel, backing its plans and offering it political cover to usurp Palestinian land," he said.
Thousands of people, Palestinians and their Arab sympathisers, vowed to avenge Dr Rantissi's slaying while denouncing Israel and the US in rallies in the Palestinian territories, Jordan, Lebanon, Syria and Iraq, Egypt, Kuwait and Tunisia.
A defiant Mr Sharon, who is trying to ward off accusations within his party and governing coalition that the Gaza pullout will only encourage militants, said at a cabinet meeting that his policy of targeted killings would continue.
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