The Israeli Security Cabinet gave the green light on Thursday for Prime Minister Ariel Sharon and his defense minister to conduct operations against "terrorist targets" in retaliation for a Palestinian suicide bombing that killed 15 Israelis outside Tel Aviv.

Responding to the deadly bombing, Yasser Arafat vowed in a televised speech to unleash his security services to prevent terrorism.

Meanwhile, an Israeli official said an agreement had been reached for all but 13 suspected Palestinian militants to leave the embattled Church of the Nativity in Bethlehem on Thursday.

A group of 26 suspected gunmen would leave first and go to Gaza and about 80 civilians would be freed outright, said Israeli army Capt. Jacob Dallal. The suspected militants, slated for deportation, would be left behind in the church for now.

Israel had been hoping to deport the 13 to Italy, but Italy refused.

Also signaling that the end of the siege was near, the Palestinian governor of Bethlehem, Mohammed Madani, left the church for the first time since the siege began. He was accompanied by two priests as he ducked through the low-slung main door of the 4th-century church.

Also early Thursday, about 10 Israeli tanks and armored vehicles entered the Palestinian section of the West Bank city of Hebron, witnesses said. Israeli military sources, speaking on condition of anonymity, said it was a limited operation but gave no other details.

Arafat said on Palestinian TV that he gave "orders and directions to all the Palestinian security forces to confront and prevent all terror attacks against Israeli civilians from any Palestinian side or parties."

President Bush called Arafat's statement against terrorism an "incredibly positive sign," and he urged Israel to consider the consequences of its response to the suicide attack.

"You've got to want peace to achieve peace," Bush said in Washington, just before meeting with Jordan's King Abdullah II.

Meanwhile, Sharon returned home from talks in Washington to determine Israel's response.

Early Thursday, the Israeli Security Cabinet "authorized the prime minister and defense minister to decide on actions against terror targets." No details were given of the decision, which came after Sharon's Security Council met.

Various proposals could include an offensive in the Gaza Strip and Arafat's expulsion.

Palestinian officials, speaking on condition of anonymity, said they expected Israel to strike at the Gaza Strip, home base of Hamas, which claimed responsibility for Tuesday's bombing and scores of other attacks during the past 19 months of fighting.

Sheik Ahmed Yassin, the Hamas spiritual leader, told The Associated Press in an interview Wednesday his group would continue attacks against Israel. "Israel's action will not go unpunished. They have harmed civilians and so their civilians will be harmed," he said. Israel arrested two Hamas leaders in the West Bank on Wednesday.

The densely populated Gaza Strip was spared during Israel's recent military operation in the West Bank, launched March 29 in response to suicide bombings that killed dozens of Israelis.

Defense Ministry spokesman Yarden Vatikay declined to comment on the possibility of an incursion into Gaza.

"Where there are terrorists, we will act and are acting now," he said. "There are no limits on us."

The suicide bombing Tuesday night killed 15 Israelis and the bomber and shattered a widespread sense among Israelis that the recent incursions into Palestinian cities had significantly curtailed the Palestinians' ability to carry out attacks in Israel.

It was followed 12 hours later by a failed suicide bombing in which a Palestinian set off explosives at a highway intersection near the northern city of Haifa. The assailant was wounded, but caused no injuries to bystanders. Fearing the bomber might have additional explosives, Israel's bomb squad used a robotic arm to drag him across the highway before police approached.

Sharon, who has held Arafat responsible for the attacks, said before beginning the emergency Cabinet session that "Israel will act strongly. The battle continues and will continue, until all those who believe that they can make gains through the use of terror will cease to exist."

Education Minister Limor Livnat, who traveled with Sharon, said "it is very possible that in the end, there will be no choice and it will be necessary to expel Arafat."

It would be extremely difficult to deport Arafat, however. Surrounded by a loyal protective guard, he's vowed never to leave. Any move to force his departure could inflame the Arab world to a degree not seen in the 19-month conflict — especially if the 72-year-old Palestinian leader were to be harmed.

A senior Israeli official said Sharon and Bush discussed moving the Palestinian leader into a ceremonial position to make way for new leadership.

In Washington, Secretary of State Colin Powell said the bombing had endangered hopes for ending months of violence that has claimed over 1,600 Palestinian lives and nearly 500 on the Israeli side.

"Every time one of these events happens, it takes us off a course we were on for a while," Powell said. "It's a course we ultimately have to get back to. ... At the end of the day, we have to find a political solution."

In a speech broadcast in Arabic across the Arab world, Arafat promised to take action against Palestinian militants — but qualified his statements by insisting his security forces needed help.

"I call on the U.S. government, President Bush and the international community to provide the support and needed immunity for the Palestinian security forces, whose infrastructure has been destroyed by the Israeli occupation, so that they can carry out and implement their orders ... to completely stop any terror attempt targeting Israeli civilians or Palestinian civilians, and to prevent using terror as a political way to achieve their goals," Arafat said.

Bush said Tuesday he would send CIA Director George Tenet to help build a Palestinian security force to fight terrorism.

The Associated Press contributed to this report.