The Gaza operation - aimed at preventing Palestinians from firing small, homemade Qassam rockets at Israeli border towns - began before dawn Friday. About 100 tanks and military vehicles took control of four square miles lined by the Palestinian towns of Beit Hanoun and Beit Lahiya and the Jabaliya refugee camp. 

"We are holding a large area from which Qassam rockets have been launched recently, including in the last two days," said the Israeli officer in charge, Col. Yoel Strick. 

He said the Israeli presence was open-ended and that the boundaries of the area being seized could change. Asked by Israel Army Radio if Israel was reoccupying the area, he said: "Yes, indeed." 

Palestinian officials said about 6,000 Palestinians live in the area seized, most in Beit Lahiya, which is closest to the border fence with Israel. 

About 40 tanks and military vehicles were parked Friday on a sandy hill overlooking Beit Lahiya and Jabaliya. Troops took over a former Palestinian police base and an elementary school, witnesses said. Bulldozers cleared orchard trees and farm land that the military said provided cover for Palestinians firing rockets. 

Mansour Abu Hamad, a 33-year-old lawyer living in the reoccupied zone, said Israeli troops surrounded his five-story apartment building and seized the rooftop of an adjacent building. From that position, troops fired from time to time toward a large housing project across the street, Abu Hamad said by telephone. 

He said all roads to the neighborhood were blocked by tanks, and that bulldozers had started digging trenches. He said five nearby Bedouin shacks went up in flames after troops fired machine guns in their direction. 

Strick, the Israeli commander, said residents in the reoccupied zones were not restricted in their movement. 

The seizure marked a growing escalation that began in the Gaza Strip on Feb. 15, when Hamas blew up a tank in the area, killing four Israeli soldiers. Dozens of Palestinians have been killed in Israeli incursions since then. 

On Thursday, several Qassam rockets were fired from Jabaliya toward the Israeli border town of Sderot, causing no damage or injuries. The rocket fire was a response to an Israeli sweep through Jabaliya earlier in the day that left 11 Palestinians dead and more than 140 wounded. 

That raid, in turn, came a day after a Hamas militant blew himself up on an Israeli bus in the northern port city of Haifa, killing 14 Israelis and an American teen. 

In other developments, Arafat met late Thursday with leaders of his Fatah movement and told them he had agreed to name Abbas as prime minister. Earlier in the week, Arafat had still been considering Monib al-Masri, a Palestinian billionaire without political clout, for the job. 

Abbas told The Associated Press on Friday that he hasn't yet made up his mind. 

"I will be able to respond negatively or positively to President Arafat's proposal when it becomes clear what kind of authorities the prime minister will have," Abbas said. 

International Mideast mediators have pressured Arafat to create the position to make him share power and reform the Palestinian government. 

Abbas has a strong political following and is known as a moderate. He has publicly called the violent Palestinian uprising a mistake and urges a return to peace negotiations with Israel. 

The PLO's Central Council will meet this weekend to approve the idea of creating the position, and the Palestinian legislature will convene next week to define the responsibilities of a prime minister. 

Also Friday, Israel said security forces arrested Jamal Abdullah, a senior Hamas bombmaker, in the West Bank town of Ramallah. The army accused him of preparing the bombs used in six attacks, including one at Jerusalem's Hebrew University in which nine people, including five Americans, were killed.