He also said there would be no unilateral withdrawal of Israeli troops from south Lebanon, as this would leave northern Israel unprotected.

"We will not tolerate the firing of Katyusha rockets and will respond with attacks on targets within Lebanon," he told Israeli army radio.

He agreed that the retaliation policy could mean an escalation of violence, but said it was needed to deter Hezbollah attacks.

His comments repeated warnings he made last week after attacks by both sides in which seven Lebanese were killed and several Israelis injured.

Mr Netanyahu's strong line came despite reports of mounting public pressure for Israeli troops to pull out of Lebanon because of increasing numbers of casualties. Twenty-four Israeli soldiers were killed there in 1998

Israel set up a self-styled security zone in the south of Lebanon in 1985 to try to shield its northern towns from cross-border attacks.