A United States diplomatic convoy has been hit by a massive bomb blast in the Gaza Strip which killed three American security personnel and injured one.
It is the first time US officials have been killed in the intifida
The attack - believed to have been a remotely-detonated roadside bomb - took place just after 1000 (0800 GMT) near the village of Beit Hanoun, near the Erez Crossing.
US ambassador to Israel Dan Kurtzer said the convoy had been on their way to interview people for a scholarship in the United States when they were attacked.
The US State department has urged all American citizens in the Gaza Strip to leave the area - and those in the West Bank to be cautious.
The victims were described by the ambassador as contract security staff. Two of the men died outright, the third afterwards and the fourth was in a stable condition.
The American FBI was on its way to investigate the "senseless and brutal attack" the ambassador said, and the US was consulting with Israel on how best to respond.
However, Mr Kurtzer said the best reaction was to continue the search for peace.
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.
There have been reports of jubilation among Palestinians in a nearby refugee camp - our correspondent says anger has been growing at what some perceive as Washington's one-sided approach to the Mid-East crisis.
US embassy personnel who went to the scene a few hours after the attack were forced to leave after Palestinian youths threw stones at them - Palestinian security sources had to fire in the air to disperse the crowd.
Israeli Apache helicopters have been flying overhead and tanks have moved into the area of Gaza where the explosion occurred.
Palestinian police are combing the site.
'Need for change'
It is the first time officials from the United States, the leading mediator in the conflict, have been killed in the three-year intifida.
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.
The US Secretary of State Colin Powell has urged Prime Minister Ahmed Qurei to take action against militants, an official from Mr Qurei's office told Reuters news agency.
The United Nations envoy to the Middle East Terje Roed-Larsen has called on the Palestinians to capture those behind the attack.
Describing the event as an "ominous widening of the conflict" Mr Roed-Larsen said it "underscores the vital need for the Palestinian Authority to revamp and strengthen its security forces so such terror attacks do not occur".
The EU's foreign policy chief Javier Solana is said to have told Mr Arafat that "condemnations and excuses will not do".
Israeli Foreign Minister Silvan Shalom said the attack showed the Palestinian Authority continued "to cover for the extremist organisations".
"This [the attack] is further proof that as long as the Palestinian Authority does not dismantle terrorist organisations, the process will not proceed," Mr Shalom said in a statement.
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.