The army has carried out searches and hundreds of Palestinians are reported to have been arrested.
But the Israeli Prime Minister, Ariel Sharon, is facing criticism over his decision to capture and hold on to Palestinian territory as long as suicide attacks continue.
Israeli military commentators say the plan to capture more territory is expensive and impractical and the Defence Minister, Binyamin Ben-Eliezer, has also said he is opposed to the renewed occupation of Palestinian territory.
Reports are also coming in of a Palestinian militant attack on a Israeli settlement near the West Bank town of Nablus in which four Jewish settlers have been killed.
The latest suicide bombings, which killed 26 Israelis in Jerusalem this week, prompted Palestinian leader Yasser Arafat to call for an immediate halt to such attacks.
Militants defiant
But his appeal was rejected by the militant groups Hamas and Islamic Jihad.
Nafez Azzam, a senior Islamic Jihad leader, told Reuters news agency: "We are in a process of legitimate self-defence.
"Israel is the one that kills innocent children and women. This war has been imposed on us by Israel."
A Hamas leader, Abdel-Aziz al-Rantissi, said: "You cannot ask someone who is being slaughtered day and night to tie his hands and not to defend himself".
The latest suicide attacks have persuaded US President George W Bush to postpone a long-awaited speech on the Middle East peace process.
Troops sweep in
Israeli troops, backed by tanks and helicopters, moved into Bethlehem and an adjacent refugee camp on Thursday morning.
Israeli tanks also entered the south-eastern suburbs of Ramallah. But they have not yet moved in on Mr Arafat's headquarters in the city.
Palestinian witnesses say Israeli troops also moved into Tulkarm and imposed a curfew on a suburb of Nablus.
Israel is continuing its occupation of Jenin and Qalqilya - where two Israeli soldiers and a Palestinian were killed on Wednesday.
Palestinian security sources said that about 1,500 people had been arrested in the West Bank.
Israeli helicopters and warplanes have also pounded buildings in the Gaza Strip, wounding a number of Palestinians.
The Israelis stepped up their operations after a suicide bomber blew himself up on Wednesday, killing seven Israelis and wounding 37 at a bus stop in northern Jerusalem.
The attack was claimed by the Al-Aqsa Martyrs Brigades, a group linked to Mr Arafat's Fatah movement.
It came a day after 19 Israelis died in another suicide attack on a bus in southern Jerusalem.
Written pleas
Israel blames Mr Arafat for the violence - despite a written statement from the Palestinian leader calling for an immediate halt to suicide attacks against civilians.
In the statement, Mr Arafat said such attacks had nothing to do with the legal right to resist Israeli occupation.
He expressed "full and comprehensive condemnation of all kinds of operations that target Israeli civilians".
"I have to be honest with you - these operations must be totally stopped," he said, warning that the alternative might be "full Israeli occupation of our lands".
On Wednesday, more than 50 prominent Palestinians took out a full-page newspaper advertisement also condemning suicide bombings.
In the ad, published by the leading Palestinian daily Al Quds, the Palestinians urged militants to "stop sending our young people to carry out such attacks".
It said the bombings only led to "a deepening of the hatred between both peoples and a deepening of the gap between us".
Signatories include Hanan Ashrawi, a leading Palestinian spokeswoman and a legislator, newspaper editor Hana Siniora, and the Palestinians' senior Jerusalem official, Sari Nusseibeh.
US peace efforts
However, the BBC's Barbara Plett in Jerusalem says it is not clear whether militants will listen, as they are not interested in the outcome of the peace process.
Recent opinion polls suggest that most Palestinians support the suicide bombings.
The latest bloodshed comes at a crucial moment in the Middle East conflict, with President Bush trying to finalise a peace strategy centring on the declaration of an interim Palestinian state.
The White House said that, after the two suicide bombings in Jerusalem, the time was not right for the president to set out his proposals.