A United States diplomatic convoy has been hit by a massive bomb blast in the Gaza Strip which killed three Americans and injured one.
It is the first time a US target has been hit inside the Palestinian territories
American sources in Israel have told the BBC that two security guards and one junior diplomat were killed in the attack - a possible roadside bomb.
The blast took place just after 1000 (0800 GMT) near the village of Beit Hanoun, about one kilometre inside the Gaza Strip, near the Erez Crossing, as the convoy of US diplomatic vehicles was passing.
Following the attack, the US embassy in Tel Aviv urged all American citizens in the Gaza Strip to leave the area - and those in the West Bank to be cautious.
Israeli reports say CIA members, officials and security staff from the office of the US Middle East envoy, John Wolf, are believed to have been in the convoy. Mr Wolf himself is not in the region.
But the BBC's Orla Guerin says it is not clear whether the easily identifiable convoy was deliberately targeted.
Two of the main Palestinian militant groups, Hamas and Islamic Jihad, have said they were not involved in the blast, according to the Reuters news agency.
But our correspondent says there have been reports of jubilation among Palestinians in a nearby refugee camp - as they get increasingly angry at what they perceive as Washington's one-sided approach to the Mid-East crisis.
US investigators were reportedly forced to leave the scene after Palestinian youths threw stones at them.
Palestinian leader Yasser Arafat has condemned "this ugly crime targeting American observers as they were on a mission for security and peace".
He has set up a commission of inquiry into the incident.
Israeli Apache helicopters are flying ahead and tanks have moved into the area of Gaza where the explosion occurred.
Palestinian police are combing the site.
Mohammed Radwan, a Palestinian taxi driver, said he was at
a nearby petrol station when the bomb went off.
"I was about to fill up my car with gas when I saw the
American convoy passing. There was a Palestinian police car in front and then three big (US) cars. When the third one passed, an explosion went off," he told the Associated Press.
"The first two cars drove quickly and stopped far from
the explosion. Palestinian security people jumped out of the
car and rushed to the car that had blown up.
"When I tried to approach them, they shouted at me to leave. I saw two people covered with blood lying next to the car," he added.
The force of the explosion completely destroyed the silver Cherokee jeep, which bore US diplomatic number plates, and left a large crater in the ground.
Blood and debris was strewn over a large area.
The BBC's Simon Wilson, also in Jerusalem, says that when foreign officials travel in and around the region they do so in heavily armoured vehicles, with many security officials in tow.
Roadside bombs have frequently been detonated against
Israeli troops operating in parts of the Gaza Strip.
Wednesday's blast came just hours after the US - Israel's closest ally - vetoed a United Nations Security Council resolution condemning Israel's controversial West Bank barrier.
The draft, introduced by Arab states, declared that the structure was illegal under international law and that construction must be halted.