An explosion tore through a bus outside Tel Aviv on Thursday, killing at least three people, minutes after Israeli helicopter gunships killed a senior Islamic militant in Gaza City.

Palestinians carry a dead body after Israeli helicopters fired on a car in Gaza December 25, 2003. A senior Islamic militant and at least four other people were killed in the missile strike, medics said. [Reuters]

Israel's Channel Two television said the dead were among at least 10 casualties in the blast, which police said was probably the work of a Palestinian militant suicide bomber.

Israeli security sources and medics said the blast took place near a bus stop on a highway leading out of Israel's coastal metropolis.

A witness who gave his name as Yosef Doll told Israel Radio: "There are wounded people lying everywhere...Other cars were hit by the blast, everything flew up in the air."

In the last big suicide attack in Israel, on October 4, a Palestinian suicide bomber blew herself up in a crowded beach restaurant in the city of Haifa, killing 23 other people.

Medics said earlier that Meqled Hamid of Islamic Jihad, a Palestinian militant group spearheading suicide attacks on Israelis, was killed along with at least four other people in an Israeli missile strike on a car in Gaza City.

Palestinian children wave at an Israeli tank advancing down a street in the West Bank town of Nablus, Thursday Dec. 25, 2003. The Israeli military has been carrying out a series of raids around Nablus in recent days, calling the city a center of militant activity. [AP]

Palestinian militants have so far rebuffed efforts by Egypt to secure a cease-fire with Israel and revive a U.S.-backed peace plan.

Israel has used helicopters to track and kill dozens of militants waging a three-year-old Palestinian uprising, but it was the first such attack on Gaza for more than two months.

On October 20, Israel killed two Hamas militants in a helicopter missile strike on a mini-van in Gaza City. Another man was killed and nine wounded.

A period of relative calm has spurred efforts to bring Israel and the Palestinians back to negotiations on a U.S.-backed peace plan that would lead to a Palestinian state by 2005 in Gaza and the West Bank.

Israel says the calm is an illusion, though, and that it has foiled at least two dozen attempts by would-be suicide bombers to reach Israeli cities.

An Israeli raid on a Gaza Strip refugee camp killed at least nine people on Tuesday, prompting Palestinians to call off a meeting that had been planned to try to arrange a peace summit.

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