Jerusalem (CNSNews.com) - Clashes between Israeli forces and Palestinians started early on Tuesday - the day marking the creation of Israel. Arabs call this day the "great catastrophe," while Israelis call it Independence Day.
Young Palestinians observed the day by throwing stones at soldiers at flashpoints in the Gaza Strip, and in an unrelated incident, Palestinian sources reported that the bodyguard of a militant Hamas leader was killed during an Israeli "attack" in the Gaza Strip.
According to the Israeli army's version of events, two "Palestinian terrorists" had drawn up in a car near the border between Israeli and PA-controlled areas. They climbed out and fired guns and a mortar shell at a passing Israeli army patrol.
"[The army] returned fire with one tank shell and destroyed the car. The two terrorists were killed," an army spokesperson said. The troops crossed the boundary, collected the launcher and mortars and returned to Israel, she added.
Hamas advocates armed struggle against Israel and opposes any sort of negotiated settlement between Israel and the Palestinians. The Islamic fundamentalist organization has claimed responsible for dozens of deadly terrorist attacks in Israel.
Elsewhere, Palestinians reported that at least 20 people had already been wounded in clashes by mid-day.
Israeli security forces are on heightened alert as Palestinians take to the streets in rallies and demonstrations to mark the naqba("catastrophe") that was the creation of the State of Israel 53 years ago.
Israeli intelligence officials said specific reports had been received that Palestinians intended to use car bombs and other explosive devices in attacks Tuesday. More mortar attacks on Jewish communities in Gaza were expected too.
Observers on both sides earlier expressed concern that the tensions which flared on Monday after five Palestinian policemen were shot dead by Israelis, could spill over into street clashes as Palestinians mark their most emotional annual day.
PA Chairman Yasser Arafat accused Israel of assassinating the policemen, killing four of them while they slept. Israel said they were killed in a gun battle.
Palestinian schools are closed for naqbaday. Church bells rang, calls from mosques sounded and car horns honked at noon, followed by three minutes of silence in honor of those killed since 1948.
Arafat is due to address the population in live radio and TV broadcasts followed by an address by the popular Palestinian poet Mahmoud Darwish in the early afternoon.
The main coordinated events are marches that will be taking place across the PA areas, said Ingrid Jaradat, director of Badil, a non-governmental organization which works for the rights of Palestinian refugees and their descendents.
Jaradat said Tuesday that no clashes had been planned, and that the marches were taking place within PA areas. However, she added, "people might decide by themselves to walk to the checkpoints" later.
The exception is in Ramallah, she said. According to the schedule publicized by Badil, participants will "express their protest" at Israeli checkpoints in the Ramallah area later in the afternoon.
Some of the most violent clashes with Israeli troops during the 32-week confrontation called the intifada have occurred in the Ramallah area.
Israeli Arab lawmakers and Arab leaders will hold a protest at a junction near Ramallah. Palestinians marching in the PA-ruled town would then try to get past the Israeli checkpoint to meet up with the Israeli Arabs, Jaradat said.
"I don't think they will make it," she added.
A high-ranking Israeli army officer told reporters on Monday that the Palestinians intended to provoke the situation and that Israel would do all it could to protect itself.
The PA was preparing to move the crowds to the streets. Then, when the action begins the PA can say that the protests were spontaneous outpourings of emotion, said the officer who spoke on condition of anonymity.
Last year, PA policemen used live ammunition against Israeli soldiers on naqbaday for the first time since rioting in 1996, the officer said. He added that he was afraid that the "same scenario" would unfold on Tuesday.
The PA was trying to reach its goals by fighting. It was part of its process of negotiation, and not a popular struggle, he claimed.
Israel has long accused the PA of using violence as a negotiating tool, stirring up trouble in order to obtain more concessions from Israel. Last summer, the peace process broke down after the failure of the U.S.-sponsored Camp David summit.
The officer said the PA was doing it's best to provoke Israel into over-reacting, but Israel would do its best to try to avoid friction.
Israel would only use "non-lethal weapons" to disperse Palestinian crowds, he said, although anyone shooting at troops with live ammunition would get life fire returned.
Secretary of State Colin Powell said on Monday that the increasing cycle of violence was "very disturbing."
"We keep appealing to both sides to be restrained, to not use violence as a way of solving the problems that exist in the region, and we continue to give that message in a very, very strong and positive voice," Powell said in an interview on an American network.
Arafat traveled to Egypt on Tuesday for consultations with Egyptian President Hosni Mubarak on the situation. Israeli sources were quoted as saying that he did not want to be in the Gaza Strip if the situation there worsened.
Arafat's deputy Abu Mazen was scheduled to meet in Washington on Tuesday with Powell.