Israeli soldiers have arrested a suspected militant leader in the West Bank town of Qalqilya - one of four towns due to be returned to Palestinian control.
Many Palestinians are sceptical about Israeli plans to withdraw
Akif Nazal, 38, of the Islamic Jihad group, was arrested overnight along with another suspected militant, Palestinian sources said.
The arrests came ahead of talks which began on Sunday evening between senior Israeli and Palestinian negotiators on the transfer of control of the towns.
Under a deal reached last week, Qalqilya and the Jordan valley town of Jericho are scheduled for handover this week, with Ramallah and Tulkarm following in about two weeks.
A top Islamic Jihad official, Mohammed al-Hindi, told the French news agency AFP the latest arrest was "new evidence that Israel is continuing its escalation policy in the region to destroy efforts by all parties to
cool the situation".
"It seems that the hand of the occupation will stay inside the city even as it withdraws," Mr al-Hindi said.
Israeli Defence Minister Shaul Mofaz and Palestinian Security Chief Mohammad Dahlan agreed on Friday that the towns should be handed over.
The Palestinian Authority's information minister, Nabil Amr, said the authority's cabinet welcomed the decision.
But on Sunday, Palestinian leader Yasser Arafat attacked the proposal, saying Israel should stick to the agreed "roadmap" for peace.
"We want Israel to implement what was mentioned in the roadmap instead of wasting time. This is a clear attempt at partitioning and to go around the roadmap," Mr Arafat said.
The roadmap is a three-phase plan that aims to reach a settlement between the Israelis and Palestinians within two years.
Islamic Jihad agreed to a three-month truce in late June and claims it is still committed to it.
However, the agreement has been put under strain by Israel's killing last week of the group's Hebron cell commander, a move Tel Aviv says prompted two suicide bombings that left two Israelis dead.
Israel is believed to be frustrated at what it regards as a Palestinian reluctance to dismantle the infrastructure
of hardline groups such as Islamic Jihad - one of the conditions of the roadmap.