Defense Minister Ehud Barak's comments Tuesday soured an already tense atmosphere. Israeli construction in east Jerusalem and the West Bank and violence between Israelis and Palestinians - and among Palestinians themselves - are threatening to overwhelm Bush's efforts.

Israeli Prime Minister Ehud Olmert told his people through a newspaper interview ahead of the visit that for their own good, they must consider giving up much of the West Bank and part of Jerusalem to the Palestinians.

Late Tuesday, Israeli security released a statement saying two gunmen who killed two Israeli hikers in the West Bank on Friday were Fatah activists, a disclosure that could further complicate peace moves. Abbas is the leader of Fatah. The statement said the two turned themselves in to Palestinian police to avoid arrest by Israeli forces.

Jan. 1 is the day Palestinian President Mahmoud Abbas' Fatah movement celebrates its anniversary, but in Gaza, Islamic militant Hamas rulers banned fireworks and marches - setting off a night and day of clashes that left eight people dead and more than 60 wounded. It was the worst outbreak of infighting since Nov. 11, when Hamas forces opened fire at a huge Fatah rally, killing eight and wounding more than 80.

By nightfall Tuesday, the internal fighting had died down, but then a Hamas militant was killed in an Israeli attack in northern Gaza, Palestinians said. The Israeli military said it targeted armed Palestinians with ground fire.

Before dawn Wednesday, five Hamas militants were killed in an Israeli operation in the central Gaza Strip, Hamas and Palestinian medical officials said.

The Israeli army confirmed that troops were operating in the area near Gaza City and that they had fired, together with Israeli aircraft, at gunmen who approached the soldiers. The toll was the highest in recent days, although militants are frequently killed in such operations against Palestinian militants who fire rockets into southern Israel.

Removing roadblocks is a constant Palestinian demand, and Israel has pledged several times to take down some of the dozens of checkpoints that have choked economic and social life in the West Bank. Israel erected the roadblocks after the Palestinian uprising erupted in 2000, when attackers infiltrated into Israel.On Tuesday, however, Barak said the roadblocks have proved an effective obstacle to Palestinian attacks, and except in isolated cases, they would not be dismantled.

"There is no chance of effectively fighting terror without practical daily control in the field, and the roadblocks will stay," Barak said.

Palestinian negotiator Saeb Erekat said Barak's comments were "very unfortunate."

"I don't think we can do anything about the economy of improvement of life or revival of institution-building" as long as the roadblocks remain, Erekat said.

The roadblocks and Israel's plans for construction in areas the Palestinians claim are high on the Palestinian agenda for peace talks, which restarted after Bush's Mideast conference in Annapolis, Maryland, in November. Bush is likely to hear harsh Palestinian complaints about Israel's policies in those areas when he visits next week.

Ahead of the Bush mission, Olmert called for Israeli concessions.

When speaking of the future, "the world that is friendly to Israel ... speaks of Israel in terms of the '67 borders. It speaks of the division of Jerusalem," Olmert said in the interview with the English-language Israeli daily The Jerusalem Post.

Israel captured the West Bank, east Jerusalem and the Gaza Strip in the 1967 Mideast war. Palestinians want those territories for an independent state, with east Jerusalem as its capital.

"What will be if we don't want to separate?" Olmert said. "Will we live eternally in a confused reality where 50 percent of the population or more are residents but not equal citizens who have the right to vote like us?"

About 5.4 million Jews live in Israel alongside 1.4 million Israeli Arabs. Another 3.9 million Palestinians live in the West Bank and Gaza Strip. Israel pulled out of Gaza in 2005.