Leaders on both sides of the Middle East divide are monitoring developments at the military hospital near Paris where Yasser Arafat lies gravely ill.
Arafat's supporters have been holding a vigil at his Paris hospital
According to medical sources inside the hospital, the Palestinian leader is on a life-support machine. A Palestinian official has said he is in a coma.
Thursday was clouded by rumours and denials about Mr Arafat's condition.
Mr Arafat, 75, has dominated Palestinian politics for 40 years, without ever designating a successor.
Hundreds of Palestinians are said to have gathered in the West Bank and Gaza Strip to show their support for their ailing leader.
A vigil is also being held outside the Percy military hospital just outside the French capital, where Mr Arafat was transferred last Friday with an as yet undiagnosed illness.
Tests have shown that he has a low count of blood platelets, which are needed for clotting, but doctors are unsure of what is causing the condition.
BBC Paris correspondent Caroline Wyatt says Thursday was a long day of contradictory accounts, but it seems almost certain that Mr Arafat's life is gradually drawing to an end.
Whether it is now a matter of hours or days is unclear, she says, but according to medical sources inside the hospital the Palestinian leader is on a life-support machine after his condition took a severe turn for the worse.
He was taken into intensive care on Wednesday where, according to a Palestinian official, he lapsed into a coma.
Palestinian officials have conceded that Mr Arafat is in critical condition, but they claim Mr Arafat was able to smile at French President Jacques Chirac when he visited in the early afternoon.
Palestinian officials held an emergency meeting in Ramallah
Later, asked if Mr Arafat was still alive, a French doctor simply said: "Mr Arafat is not dead."
Some erroneous official pronouncements were made on Thursday amid reports, many in the Israeli media, that Mr Arafat had died.
Luxembourg's Prime Minister, Jean-Claude Juncker, announced to reporters at the European Union summit that Mr Arafat had died, only to retract the statement after his advisers said there had been a misunderstanding.
In Washington, a reporter wrongly told President George W Bush that Mr Arafat had died. Mr Bush reacted by saying: "God bless his soul."
Preparations at home
Both Palestinian security services and Israeli military leaders are reported to have held emergency planning meetings.
Officials gathered for meetings of the Palestinian Liberation Organisation (PLO) decision-making executive committee and the Fatah movement central committee - both of which have been headed by Mr Arafat for more than 40 years.
In the West Bank, Palestinian officials said Prime Minister Ahmed Qurei had been assigned some of Mr Arafat's powers, and that he was due on Friday to visit the Gaza Strip - where it is thought he will meet leaders of the militant group Hamas..
About 2,000 people were reported to have gathered in the West Bank and Gaza Strip in support of their leader, after a PLO spokesman asked Palestinians to pray for him.
The Israeli military has been put on high alert, although no troops have been moved into potential trouble spots.
Israeli Prime Minister Ariel Sharon has said he will allow Mr Arafat to return to his headquarters in the West Bank town of Ramallah if he recovers.
But he has made it clear he will not allow his old adversary to be buried in Muslim holy ground in east Jerusalem.
There are fears that Mr Arafat's demise could spark chaos in the volatile Gaza Strip, already destabilised by inter-factional fighting and uncertainty over Israel's planned pullout from the area.
There is no clear line of succession should Mr Arafat be unable to continue in power.
He has not anointed a successor, although the parliamentary speaker would take over temporarily.