Checkpoint bomb kills two Palestinians
Armed militants within Palestinian President Yasser Arafat's Fatah movement claimed responsibility and apologised for the Palestinian casualties, saying their target had been Israeli soldiers and police.
Israeli police said the bomb was apparently destined for Jerusalem.
The blast raised the prospect of a fierce Israeli army response likely to focus on the nearby West Bank city of Ramallah, Mr Arafat's headquarters and the territory's political and commercial centre.
The bomb, hidden either in a car or beside it, blew up when Israeli border police approached the vehicle between the Qalandiya and A-Ram checkpoints during a search after a security alert was declared, police spokesman Gil Kleiman said.
But he added: "We are not ruling out a suicide bombing either. We just don't have a body to indicate that."
Palestinian medics in Ramallah said two Palestinians were killed, including 56-year-old Salah Abu Sneinah at the wheel of his car, while the other was not identified.
Naheda Abu Sneinah, 15, Mr Abu Sneinah's daughter who was in the car with him, screamed in grief inside the Ramallah hospital where his body was taken.
Thirteen Palestinians were wounded including Mr Abu Sneinah's 4-year-old nephew, who was in critical condition. Six Israeli policemen were wounded, three seriously.
The blast occurred inside an obstacle course of barbed wire and concrete barriers between the checkpoints where thousands of Palestinians queue daily for identity checks on a main road between Jerusalem and Ramallah.
The checkpoint bomb broke a lull in militant attacks in the Jerusalem area since February, when a suicide bomber killed eight people aboard a Jerusalem municipal bus.
Militant attacks inside Israel have abated this year. Israel says this follows Israeli killings of many cell commanders in raids, better intelligence tip-offs used to intercept militants en route, and Israel's partly built West Bank barrier.
