Militants from the Palestinian faction Hamas are pushing back rivals Fatah in the Gaza Strip after several days of fighting in which 80 people have died.
The fighting in Gaza is the worst in months
Hamas said it had gained control of much of southern Gaza after pushing Fatah gunmen out of the north.
The fighting has spilled over into the West Bank with a gun battle breaking out in the northern town of Nablus.
Senior Hamas and Fatah officials said a deal had been agreed to end fighting but clashes continued in Gaza City.
Senior Fatah official, Palestinian Deputy Prime Minister Azzam al-Ahmad, said the deal had been reached in the late afternoon on Wednesday.
He said Fatah had in principle accepted a list of conditions presented by Hamas, although more dialogue between the two sides was needed.
Since then, Mr Ahmad said, Hamas had not responded.
Hamas' military wing says it has received no orders from the movement's politicians to put down its guns, the BBC's Katya Adler in the West Bank town of Ramallah says.
Earlier, a Hamas official told the BBC that Palestinian Prime Minister Ismail Haniya, from Hamas, and Palestinian Authority President Mahmoud Abbas, from Fatah, had spoken on the telephone.
The Hamas source said a nine-point plan had been presented to Fatah which includes demands that Hamas appoint the Palestinian interior minister to be responsible for all security forces.
Hamas also demanded that it share control with Fatah of Gaza's boundaries and borders, the official said.
Armed members from the factions have been battling in Gaza for several days for control of key security posts.
At least 17 people were reported killed in fighting on Wednesday with 80 reported to have died since Saturday.
Hamas appears to be winning this bitter battle for all-out control of Gaza, our correspondent says.
Clashes have been going on since Saturday when hundreds of Fatah and Hamas gunmen fought on the streets and rooftops of Rafah with rocket-propelled grenades and machine guns.
A truce agreed on Monday was quickly broken and fighting escalated across northern Gaza.
On Wednesday, the fighting spread across central and southern Gaza.
In the latest developments:
At least 200 gunmen of the Fatah-allied Bakr clan surrendered to Hamas in Gaza City, clan elders and witnesses said
An explosion wrecked the Khan Younis headquarters of the Fatah-linked Preventive Security force, killing five people
There were clashes in Gaza City near a local Fatah commander's home and in high rise buildings for control of sniper posts. Six militants were reported killed
Hamas gunmen gained control of Gaza's main north-south road
And Hamas said it had taken control of the border in the south between Gaza and Egypt.
Even as the fighting intensified in Gaza, violence spread to the West Bank with a gun battle in Nablus. Fatah gunmen took hostage a number of Hamas members.
The BBC's Tim Franks was taken by Fatah militants to the Balata refugee camp in Nablus where he was shown the Hamas hostages.
The Fatah men promised "blood for blood" in the West Bank if the Hamas attacks in Gaza did not stop.
Hamas has issued its own ultimatum to Fatah militants in Gaza to lay down their weapons by 1600 GMT on Friday or risk having them taken from them.
A senior UN co-ordinator for the Middle East said the situation in Gaza was one of the gravest crises the Palestinian people had faced.
"I think we're witnessing a Hamas takeover in Gaza which will be very difficult to reverse," Michael Williams, a senior UN co-ordinator for the Middle East, told the BBC.
Two workers from the UN relief agency were also among those who died on Wednesday.
One man was apparently killed in crossfire in Khan Younis, the UNRWA said. The other died from wounds sustained on Tuesday.
The UN said it would temporarily scale back its operations in Gaza.
The international community has called for a ceasefire, and Arab League head Amr Moussa said the fighting was destroying the Palestinian cause.