U.S. Middle East envoy John Wolf (search) met with a top Palestinian official Wednesday to try to ease a crisis within the Palestinian leadership that prompted Prime Minister Mahmoud Abbas (search) to threaten to quit, a diplomat said.

Israeli media reports said Wolf would also meet with Israeli Defense Minister Shaul Mofaz (search) and urge Israel to release more Palestinian prisoners and dismantle more illegal settlement outposts, moves that Palestinians have been demanding and which would bolster Abbas' position.

Raanan Gissin, an adviser to Israeli Prime Minister Ariel Sharon (search), said Wolf was "exploring ways of how to advance the peace process, how to speed it up, how to move it along."

A diplomat confirmed the meeting with Palestinian security chief Mohammed Dahlan and indicated that meetings with Israeli officials were also planned.

On Tuesday, Abbas threatened to resign unless his party backed his tactics in talks with Israelis, Palestinian officials said. The three largest Palestinian militant groups declared a unilateral cease-fire June 29, but say it will collapse unless Israel releases the bulk of thousands of Palestinian prisoners it holds.

On Wednesday, Sheik Ahmed Yassin, founder of the militant group Hamas, said the release of prisoners "is a red line which we cannot pass."

Speaking after a meeting with Egyptian security officials in the Gaza Strip, Yassin said his group remained committed to the truce but needed to see a mass prisoner releases by Israel.

"We ... told them that we are going to be patient, but patience is limited," he said.

Egyptian officials said the delegation would meet leaders of the three main Palestinian militant groups, urging them to maintain the cease-fire.

Underscoring the fragile state of Israeli-Palestinian peace moves, Israeli soldiers overnight shot and killed 27-year-old Iyad Halanesh and seriously wounded his 26-year-old wife during an operation in the West Bank to arrest Halanesh's brother, a member of Yasser Arafat's Fatah movement, Palestinian sources said.

The Israeli army confirmed that soldiers shot a man during a raid. They said soldiers were fired on during an arrest operation and returned fire, hitting the gunman. The army said the militant they arrested had planned to carry out a shooting attack Wednesday. They could not confirm the name or condition of the man who was shot, or say whether a woman also was wounded.

On Tuesday, as internal tensions rose in the Palestinian leadership, Abbas called off a meeting with Israeli Prime Minister Ariel Sharon set for Wednesday. Some officials blamed Israel's refusal to release more prisoners and others cited a lack of support for Abbas from fellow political leaders.

Also Tuesday, in a largely symbolic gesture, Abbas resigned from Fatah's central committee, Fatah officials said. In his decades as Arafat's deputy in Fatah and the PLO, Abbas has resigned or threatened to resign many times. Fatah insiders said this time, too, it was a ploy to force Fatah to back him. Sakher Habash, an Arafat loyalist on the central committee, said Wednesday that the committee had rejected the resignation

"Abu Mazen (Abbas) will not be able to continue as prime minister if he is not a member of the central committee. that's why we have rejected his resignation," he said.

The United States, which pushed for Abbas' appointment in April, gave its backing to the embattled prime minister. White House spokesman Ari Fleischer said President Bush "is confident" in Abbas.

"The Palestinian Authority still has responsibilities. Internal Palestinian politics is complicated for Palestinians, let alone outside observers," Fleischer told reporters in South Africa, the latest stop on Bush's African trip this week.

Fatah has been in turmoil over the declaration of the cease-fire 10 days ago, which also obligates its affiliated militia, the Al Aqsa Martyrs' Brigades, to honor it. Militant groups, with backing from some Fatah activists, criticized Abbas for not pressing Israel harder for release of Palestinian prisoners.

In a letter to Arafat, Abbas said he would step down as prime minister unless he received clear instructions from Fatah over how to handle contacts with Israel.

Fatah officials said Abbas' move might be a pressure tactic aimed at forcing Fatah members to give him greater flexibility in the talks.

Israel refuses to free detainees involved directly in terror attacks, including members of Hamas and Islamic Jihad. Abbas is said to be concerned that if Israel sticks by its refusal, the two groups might cancel their three-month truce. Fatah called a six-month cease-fire.

Israel is holding about 7,000 Palestinian prisoners, most of them rounded up during the current 33-month conflict.