Twelve Israelis were killed and 15 others were wounded Friday when Palestinian militants opened fire on Jewish worshippers as they walked toward a disputed shrine after sundown.
A high-level Israeli military official was among the dead.
A nearby army post and other soldiers rushing to the scene were also caught in the ambush in the West Bank city, army sources said.
The settlers came under fire in a planned ambush as they wound their way into Hebron to mark the beginning of the Jewish Sabbath at the Tomb of the Patriarchs, a shrine revered by both Muslims and Jews.
The militant Islamic Jihad group claimed responsibility, saying it was avenging the killing of its northern West Bank commander, Iyad Sawalha, by Israeli troops several days ago.
An army official, speaking on condition of anonymity, said the settlers were caught in a well-planned ambush after the start of the Sabbath. Gun battles raged for more than 90 minutes, making it difficult for troops to reach the wounded.
Israeli media reported that soldiers who tried to assist civilians under fire were caught in an ambush that included sniper fire from the hilltop suburb of Abu Sneineh.
It was the deadliest attack on Israelis since Oct. 21 when 14 people were killed in a bus bombing in northern Israel.
The attack comes five days after a Palestinian gunman killed five people, including two small boys, on an Israeli kibbutz, and it was sure to increase pressure on Prime Minister Ariel Sharon to respond decisively.
One idea that could arise again is the expulsion of Palestinian leader Yasser Arafat — which Israel's new foreign minister, Benjamin Netanyahu, has been strongly advocating.
The attack came as Egypt and Arafat's Fatah movement were trying to persuade the Islamic militant group Hamas to stop attacks on civilians in Israel, at least until after Israel's Jan. 28 election.
Islamic Jihad is not part of the talks — and even an agreement in those negotiations would not have stopped Friday's attacks; a possible moratorium would not apply to the West Bank and Gaza Strip.
In the Shati refugee camp in the Gaza Strip, dozens of Islamic Jihad supporters rushed into the streets in celebration, some firing in the air. "This is retaliation for the daily crimes and ugly massacres committed by the Zionist occupation against our people," one armed man said over loudspeaker.
The Israeli Foreign Ministry said the Palestinians had carried out a "Sabbath massacre."
"No political process can take root while these atrocities continue to be carried out by Palestinian terrorists," said ministry spokesman Gilad Millo.
Sharon and Defense Minister Shaul Mofaz were consulting by telephone, but there were no plans to convene a special Cabinet meeting.
The so-called "worshippers' lane," which links the Jewish settlement of Kiryat Arba and downtown Hebron, has been targeted by Palestinian gunmen in the past.
"It's a real problem to secure every centimeter ... and this time, through careful, intricate planning ... the attack succeeded," said reserve Col. Yoni Fiegel, a former commander of Hebron.
There was no immediate reaction by the Palestinian Authority.
Also on Friday, in Anzar, a Palestinian village near the West Bank town of Jenin, Israeli troops killed Mahmoud Obeid, 28, an activist in Arafat's Fatah movement, as he tried to evade arrest, army officials said. Obeid's father, Abbas Obeid, said his son was shot and killed when he opened the door to his house to look outside.
And in the West Bank city of Ramallah, several Israeli soldiers stopped a Palestinian producer with Associated Press Television News. Haitham Hamad said he was beaten and kicked in the legs and head, even after identifying himself as a journalist. He was briefly treated at a hospital and released. The army said it was checking the incident.
Most of Hebron is controlled by the Palestinian Authority, but the Israeli army patrols the center of the city, where about 450 Jewish settlers live in three enclaves, surrounded by 130,000 Palestinians. The 30,000 Palestinians living near the enclaves are also under Israeli control and are subjected to frequent curfews.
Hebron had been quiet in recent weeks, and Israeli troops had withdrawn from most of the Palestinian-controlled sector of the city.
Nearly all the Jews in Hebron and many living in the nearby settlement of Kiryat Arba walk to the Tomb of the Patriarchs every Friday evening, and the route is heavily guarded by Israeli security forces. The site is the burial place of the biblical Abraham, Isaac and Jacob, who are revered by both faiths.
Both Israelis and Palestinians draw on past suffering to fuel their current grievances in the city, 25 miles south of Jerusalem.
After living in Hebron for centuries, Jews were driven out during Arab riots in 1929. Dozens were massacred.
When Israel captured the West Bank in the 1967 Middle East war, settlers began moving back into what had been Hebron's Jewish quarter. Kiryat Arba, one of the West Bank's largest settlements, was established in 1972, and is home to thousands of Israelis today.
Relations with Palestinians, rarely friendly, deteriorated sharply in 1994, when Baruch Goldstein, a New York-born settler who lived in Kiryat Arba, gunned down 29 Muslim worshippers inside the mosque at the Tomb of the Patriarchs. He was beaten to death by the survivors.
That massacre led to calls within Israel — where many people oppose the Hebron settlement and the high price of defending it — that the settlers to be evacuated. The settlers, among the most ideological in the West Bank, have also had an occasionally rocky relationship with the Israeli soldiers defending them.
The Associated Press contributed to this report.