An Israeli warplane narrowly failed to assassinate a Hamas leader but killed his son and a bodyguard in Gaza on Wednesday, a day after two Palestinian suicide bombers killed 15 people in Israel.

The missile strike flattened the two-story home of Mahmoud al-Zahar, co-founder of the militant Islamic group and one of its top political officials, as a new wave of tit-for-tat violence drowned a dying U.S.-backed peace plan in blood.

Zahar, 58, was standing inside his house when the missile hit and was thrown by the force of the explosion, witnesses said. He sustained light injuries but his wife was seriously hurt, medical workers said.

Violence resumed in Gaza after nightfall when Israeli tanks fired across the boundary into the Mediterranean territory.

Palestinian security sources said the tanks targeted Palestinian police posts along the border fence and a policeman was wounded. Israeli military sources said the tanks fired at a would-be border infiltrator and apparently drove him back.

Security sources also said Israeli troops shot a Palestinian in the West Bank who later died of his wounds.

Hamas, which claimed responsibility for Tuesday's bombings, which killed eight soldiers at bus stop near Tel Aviv and seven people in a Jerusalem cafe, vowed to avenge the attack on Zahar by widening its list of targets to include Israeli homes.

"The enemy has to harvest what it has sown," Hamas said in a statement faxed to news organizations.

Israelis and Palestinians alike braced for more of a familiar cycle of attack and retribution, seeing little chance of salvaging a U.S.-backed peace "road map" envisaging a Palestinian state in Israeli-occupied territory.

POLITICAL CRISIS

Trying to defuse a political crisis amid the violence, Palestinian parliament speaker Ahmed Qurie said he had accepted his nomination for prime minister by Yasser Arafat and would seek assembly approval on Thursday for an emergency cabinet.

But Palestinian lawmakers told Reuters late on Wednesday the legislative session had been postponed as Israel was withholding permits for some MPs to travel to the West Bank city of Ramallah. Much of the territory is under Israeli army closure.

Israel immediately demanded that Qurie "fight terrorism." Palestinian officials want Israel to halt military action first.

Qurie, speaking to reporters in Ramallah, condemned the assassination attempt against Zahar as cowardly as thousands of Hamas backers marched in Gaza City chanting "Death to Israel."

The attempt to kill Zahar was the latest in a series of strikes on Hamas leaders in recent weeks.

Qurie, seen as a moderate with strong backing in parliament but little grassroots support, said he would seek approval from parliament for a emergency cabinet of six to eight members.

"We are in a crisis as a result of Israeli assassinations, raids and attacks on the Palestinian people, as well as attacks on Israelis. This must be dealt with and will be given priority by my government," he told Reuters on Wednesday evening.

In Washington, President Bush demanded that the Palestinians' new leadership unequivocally declare its opposition to terrorism and dismantle militant groups.

Bush told reporters he still believed in the "road map" and said time would tell whether he could work with Qurie.

Israeli Finance Minister Benjamin Netanyahu said construction would be hastened on a barrier in the West Bank, a project the Palestinians call a new "Berlin Wall" but which Israel says it needs to keep out suicide bombers.

Israeli security sources said troops shot a Palestinian man fleeing after he was found cutting through part of the barrier on Wednesday night, and he died while being taken to hospital.

Palestinian security sources identified the dead Palestinian as a 14-year-old boy called Ahmad Tahainah.

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