The Israeli leader hopes to score a decisive victory against the violent group ahead of an Israeli withdrawal from the Gaza Strip (search), but risks unleashing a wave of Palestinian revenge attacks that could easily spin out of control.
Yassin was an attractive and relatively easy target for Israel.
The quadriplegic had a high profile as the spiritual leader of the group, even if he was not seen as being involved in the day-Israel.
Despite recent Israeli warnings that he was "marked for death," Yassin did not slip into hiding and instead followed his daily routine, including trips from his home to a nearby mosque. Israeli missiles struck him at daybreak Monday, just as Yassin left the mosque after morning prayers.
Hamas (search) and the Israeli military were engaged in a "war of attrition" during the latest round of Israeli-Palestinian fighting, which began in September 2000. Hamas would carry out homicide bombings and other attacks on Israelis, and Israel would even the score with airstrikes and ground operations.
However, the game changed dramatically when Sharon announced last month he was considering withdrawing from most of Gaza. The declaration drove both the Israeli military and Hamas to intensify the battle in hopes of claiming the Israeli pullback as a victory.
Israeli generals expressed concern that Israel will be seen as fleeing the Gaza Strip and have advocated harsh strikes against Hamas. They said they do not want to see a repeat of Israel's hasty withdrawal from Lebanon in May 2000, which was claimed as a victory by the Lebanese guerrilla group Hezbollah and was seen as one of the causes for the outbreak of the Palestinian uprising months later.
Defense Minister Shaul Mofaz told the Israeli Cabinet on Sunday that he has prepared a plan to strike hard against Hamas.
However, Hamas is likely to retaliate with a series of homicide bombings. The group has made good on his threats in the past. The Al Aqsa Martyrs' Brigades (search), an armed group linked to Yasser Arafat's Fatah movement, and the violent Islamic Jihad said Monday they would join Hamas in waging bloody retaliation on Israel.
While the Yassin assassination appears to have the backing of the Israeli public, the mood could quickly change if there is a series of revenge attacks.
"The Pandora's box has been opened. We are counting down to the next terror attack and the question is how many Israelis will be killed," said Yossi Beilin, a dovish Israeli politician.
However, others said that despite Hamas' fiery rhetoric, there is little the group could do that it has not tried before.
"While their motivation might be higher, it is not going to make any difference to their capability," said Israeli analyst Yossi Alpher.