SENIOR Israeli officials expressed support yesterday for the transfer of Arab parts of Jerusalem to Palestinian control, offering a concession on one of the most contentious issues in the Middle East conflict.

Israel should turn over Arab neighbourhoods in Jerusalem to the Palestinians as part of a peace deal with the moderate government of President Mahmoud Abbas, Israel’s deputy prime minister said today in some of the frankest remarks to date about what Israel might be willing to relinquish.

a meeting with the Palestinian leader today, Israeli Prime Minister Ehud Olmert proposed releasing some prisoners, lifting some West Bank roadblocks and establishing a team to work on a broad agreement in advance of a US-sponsored peace conference in November.

Prime minister Ehud Olmert convened his top ministers today to discuss Israel’s response to the latest wave of Palestinian rocket fire from the Gaza Strip.

The Israeli Supreme Court today ordered the government to reroute the best known section of its West Bank separation barrier, dealing a symbolic defeat to the state after a 2 1/2-year legal battle that has turned Bilin into a flashpoint of opposition to the contentious structure.

Israel killed a top Islamic Jihad militant in an airstrike just hours after Palestinian President Mahmoud Abbas said he hoped to reach a full peace deal with Israel in less than a year.

Israel’s Supreme Court has ordered the state to justify its plea bargain that dropped rape charges against the former president.

Israeli president Moshe Katsav has agreed to resign in a controversial plea bargain that drops rape allegations and the threat of jail time in return for admitting lesser charges.

Israeli President Moshe Katsav’s lawyers made a last-ditch effort today to stave off an indictment on rape and other sexual assault charges at a hearing before Israel’s top prosecutor.

Israeli police commander Moshe Karadi resigned from his post today after a government commission found he should not continue because of involvement in a scandal involving underworld figures.

Israel’s minister for justice, a close ally of Prime Minister Ehud Olmert, today announced he was resigning to clear the way for a trial on charges of sexual harassment.

Israel’s justice minister, a top ally of Prime Minister Ehud Olmert, faces possible indictment on sexual harassment charges, in a new blow to a government that emerged politically weakened this week from a 34-day war against Lebanese guerrillas

The Lebanese prime minister rejected a UN ceasefire plan backed by President George Bush, demanding that Israel immediately pull out from southern Lebanon even before a peacekeeping force arrives to act as a buffer between Hezbollah and the Jewish state.

An Arab delegation will address the United Nations today after Lebanon’s government rejected a ceasefire plan backed by US president George Bush.

Hezbollah fired an enormous barrage of rockets at towns across northern Israel today, killing 10 people in the worst attack on Israel since the violence began on July 12, rescue services said.

In a major expansion of its ground offensive, Israel decided to send troops deeper into Lebanon, up to the Litani River some 18 miles from the Israeli border, to clear out Hezbollah fighters and hold the territory until a multi-national force is deployed there, senior officials said today.

AS thousands of civilians trapped for nearly three weeks in south Lebanon’s war zone streamed north yesterday by truck, car and on foot, Israeli prime minister Ehud Olmert vowed there would be no ceasefire in the fight against Hezbollah.

Israel will “expand and strengthen” its attack on Hezbollah guerrillas in Lebanon, the defence minister said today, diminishing hopes that a 48-hour halt in air strikes could be turned into a longer-term ceasefire.

US secretary of state Condoleezza Rice returns to the Middle East today in another attempt to forge an agreement for a multinational force aimed at bringing an end to the Israeli-Hezbollah fighting.

US Secretary of State Condoleezza Rice, after conferring with her aides, said today she will return to the Middle East to work with others on trying to bring an end to the Israeli-Hezbollah fighting, but did not say when she would travel.

The European Union said today that Israel misinterpreted the outcome of the Middle East conference in Rome and that the fighting in Lebanon should cease immediately.

Israeli Cabinet ministers today decided not to expand the country’s Lebanon offensive, but ordered the call up of tens of thousands of reserve soldiers to boost the campaign, officials said.

Israeli warplanes staged a series of raids in northern, eastern and southern Lebanon early today, targeting suspected Hezbollah hideouts, striking a Lebanese army base and destroying roads, Lebanese security officials said.

In failing to agree on a call for an immediate Middle East ceasefire, the world has given Israel permission to press ahead with its military offensive in Lebanon, a senior Israeli cabinet minister said today.

Israel must unleash massive air strikes against villages in south Lebanon to clear out Hezbollah gunmen, an Israeli cabinet minister said today, as the Israeli government was to decide whether to broaden the military offensive against the Lebanese guerrillas.

Palestinian militants today gave Israel 24 hours to start releasing hundreds of Palestinian prisoners, implying they will kill an abducted Israeli soldier tomorrow morning if their demands are not met.

A senior Israeli Cabinet minister today warned of a harsh military response in the Gaza Strip if an abducted Israeli is harmed by his Palestinian captors.

Israel’s military offensive in Gaza could jeopardise the life of an Israeli soldier held by Palestinian militants, a senior Hamas official said today.

Palestinians dug in behind walls and and embankments in the southern Gaza Strip today after Israel sent in troops and tanks.

An Israeli Cabinet minister today said that Hamas’ Syria-based leader, Khaled Mashaal, is a target for assassination for ordering the kidnapping of an Israeli soldier in the Gaza Strip.

A Palestinian militant leader today said a captured Israeli soldier was being held in a “secure place,” and he claimed that his group also seized a Jewish settler in the West Bank.

Palestinian militants in the Gaza Strip fired three home-made rockets into Israel today, hours after Israeli prime minister Ehud Olmert pledged to push forward with airstrikes against the militants despite a recent string of civilian casualties.

Israeli prime minister Ehud Olmert told a joint meeting of US Congress that Israel would be a “willing partner in peace” with the Palestinians, but would draw its own borders in the West Bank should it conclude it had no negotiating partner.

ISRAEL will try diplomacy with the Palestinians until the end of the year before resorting to a plan to set a border unilaterally in the occupied West Bank, a senior cabinet minister said yesterday.

Israel will move ahead with plans to unilaterally draw its final borders by 2010 if Hamas does not recognise Israel and renounce violence within six months, a senior Israeli Cabinet minister said today.

Israel will give the Palestinians until the end of the year to prove they are willing to negotiate a final peace deal, and will unilaterally set its final borders with them by 2008 if they don’t, according to a close associate of prime minister Ehud Olmert.

ACTING Israeli Prime Minister Ehud Olmert's Kadima Party is seeking swift coalition negotiations to carry out its plan to pull out of much of the West Bank and draw Israel's borders by 2010.

After declaring victory in Israeli elections, acting Prime Minister Ehud Olmert’s Kadima Party said today it would quickly form a broad ruling coalition that will pull out of much of the West Bank and draw Israel’s borders by 2010.

Israel is considering barring Palestinian labourers and goods from entering Israeli territory after a Hamas-dominated parliament is sworn in this weekend, security officials said today.

Israel returned to politics today while Prime Minister Ariel Sharon was improving, but still comatose in a hospital a week after a massive stroke.

Israeli prime minister Ariel Sharon underwent emergency surgery today after a brain scan revealed a rise in intracranial pressure and some bleeding in his brain.

MPs from Israeli Prime Minister Ariel Sharon’s new Kadima party held their first formal meeting today, sketching out broad policy goals including peaceful co-existence between Israel and a future Palestinian state, but stopping short of adopting a detailed party platform.

A leading member of Israel’s Labour Party, Haim Ramon, today became the first politician in his faction to join Prime Minister Ariel Sharon’s new political list.

Israel’s prime minister Ariel Sharon lashed out against terrorism and praised the world for taking on Syria and Iran, as rebels in his own party continued moves to force him out of office.