JERUSALEM - The rising confidence and bellicosity of Hamas militants in the Gaza Strip, combined with rapidly deteriorating relations with Israel's would-be peace partner in the West Bank, are raising jitters in Israel that a new Palestinian uprising could be near.

A number of prominent voices urged Prime Minister Benjamin Netanyahu on Sunday to take steps to ease the tensions and bolster the Western-backed Palestinian president, Mahmoud Abbas. Netanyahu's political rival, former Prime Minister Ehud Olmert, warned that renewed violence might not be "far off."

But the Israeli leader stood tough. "We in the government have no illusions. We want a true peace with our neighbors. But we will not close our eyes and stick our heads in the sand," Netanyahu told his cabinet.

Over the past month, Netanyahu has taken steps that appear to have unintentionally emboldened the rival Palestinian leaderships in Gaza and the West Bank.

In mid-November, Israel carried out an eight-day military offensive in Gaza in response to months of intensifying rocket fire from the Hamas-ruled territory.

Although Israel claimed to inflict heavy damage, the operation failed to halt the rocket fire before an Egyptian-brokered cease-fire took hold and Hamas emerged intact. Hamas has claimed victory, won new recognition across the Middle East, and boosted its popularity with the Palestinian public.

Hundreds of thousands of people took to the streets of Gaza over the weekend to welcome the movement's exiled leader, Khaled Mashaal, as the Islamic militant group celebrated its 25th anniversary with rallies, speeches, and displays of weapons.

It was the first time Mashaal has ever been to Gaza, and his three-day presence in the seaside territory was a reflection of the group's rising clout.

In speech after speech, Mashaal praised Hamas fighters for standing up to Israel and repeated the movement's original goal of wiping Israel off the map.

"God willing, we shall liberate Palestine together, inch by inch," Mashaal told university students Sunday, referring to the West Bank, Gaza, Jerusalem, and Israel. "We started this path and we are going to continue until we achieve what God has promised."

Hamas seized control of Gaza in mid-2007, ousting forces loyal to Abbas. Repeated attempts at reconciliation have failed.

The Palestinian rift has pushed Abbas into an uneasy alliance with Israel, with both sides united in their opposition to Hamas. But Israel's ties with Abbas have also frayed as peace efforts remained frozen. Abbas and Netanyahu blame each other for the deadlock. Fed up with the impasse, Abbas last month won U.N. recognition of a Palestinian state in the West Bank, east Jerusalem and Gaza Strip, territories captured by Israel in the 1967 Mideast war.

While the move did not change the situation on the ground, it was seen as an international endorsement of the Palestinian position on future borders with Israel.

It also amounted to international rejection of Israeli settlement building in the West Bank and east Jerusalem. Netanyahu responded by announcing plans to build thousands of new settlement homes, sparking fierce international condemnations.

Speaking at a business conference, President Shimon Peres, a Nobel peace laureate, said weekend events in Gaza showed that Abbas is a peaceful and desirable alternative to Hamas. "We have two clear choices, nobody is perfect but one is right and the other is wrong," Peres said.

Olmert, speaking at the same conference, accused Netanyahu of undermining moderate Palestinian elements.

Netanyahu showed no signs of bending. Speaking to his cabinet, he said the celebrations in Gaza over the weekend exposed "the true face of our enemies." He continued: "They have no intention of compromising with us. They want to destroy our country, but they will obviously fail."