Israel must halt construction of a West Bank security barrier and show movement on other issues if it wants a summit between the Palestinian and Israeli leaders, Palestinian Prime Minister Ahmed Qureia said.

Israeli Prime Minister Ariel Sharon said Monday that he would not accept preconditions for a meeting, and the dispute threatened to derail efforts to end three years of violence and breathe life into the stalled "road map" peace plan.

In an interview with The Associated Press, Qureia said Israel should also stop all construction in Jewish settlements (search) — a key road map requirement that Sharon has evaded. Sharon must end travel restrictions on Palestinians in the West Bank and Gaza, lift a siege on Palestinian leader Yasser Arafat and release Palestinian prisoners, Qureia said.

"If now Mr. Sharon says he's ready to discuss seriously (these) issues ... and declares that he's ready to take decisions that will satisfy both the Palestinian and Israeli sides, then I'll be ready to meet," he said. "I want a meeting that will end up with positive results."

However, Qureia gave no indication that he would be willing to dismantle militant groups, which Israel is demanding and which also is required in the first phase of the road map. He stuck to his previous position that the Palestinian Authority would enforce quiet after a truce is reached.

Arafat, who has been confined to the West Bank town of Ramallah (search) for nearly two years, attended morning prayers early Tuesday to mark the Muslim feast of Eid al-Fitr (search). Arafat said the Palestinians remain committed to the road map, and accused Israel of blocking the plan. "Unfortunately, the other side did not agree to the road map," he said.

Sharon told lawmakers from his Likud Party agitated over his recent statements that he might take unspecified "unilateral steps" if talks fail — and media reports that these might include the dismantling of some isolated Jewish settlements as part of Israel drawing its own border with the Palestinians.

Sharon also rejected any preconditions for a meeting with Qureia, saying, "if he wants to meet, we'll meet, if he doesn't, we won't," according to a participant in the closed-door meeting.

Sharon refused to detail the ideas and avoided talk about dismantling settlements — but did say that if "there is no progress (in talks) we will take unilateral steps, not as concessions, but in our interest," according to the legislator, who spoke on condition of anonymity.

The lawmaker said Sharon added that "if there is a cease-fire and the dismantling of the terrorist infrastructure, they (the Palestinians) will attain an independent state."

Reaction was mixed. Cabinet Minister Uzi Landau said that talk of unilateral evacuation of settlements "encourages terrorism." But deputy minister Yaakov Edri supported Sharon, saying that "after three years of bloodshed, in which we have proven to the Palestinians that they will gain nothing from terror, we can permit ourselves to take the initiative in diplomatic steps."

Skeptical Palestinians and Israeli doves saw a public relations gimmick.

"We've heard many promises, but nothing has come of them," said Israeli opposition leader Shimon Peres, adding that the removal even of small settlements would break up Sharon's center-right coalition.

Palestinians want a state in all of the West Bank and Gaza Strip — which were captured by Israel in the 1967 Mideast war — and consider all Jewish settlements in those areas illegal. But some influential Palestinians have indicated Israel could keep some settlements if it gave the Palestinians some Israeli land in return.

The Palestinians also object to the security barrier, whose planned route cuts deep into the West Bank in several areas to incorporate Jewish settlements into the "Israeli" side. About a quarter of the planned 360-mile route, consisting of fences, walls, and trenches, has been completed. Israel says the barrier is needed to keep out suicide bombers; the Palestinians see it as a land grab.

The United States is also increasing pressure on Sharon. After backing most of Israel's policies, including military strikes against Palestinians, President Bush last week harshly criticized the security barrier and Israeli restrictions against Palestinians.

The Maariv newspaper reported Tuesday that Israel and the United States have agreed to deduct $250 million from American loan guarantees to Israel. The sum represents the cost of the barrier, the paper reported.