Militants raided a Palestinian police station and a local government office on Saturday, as unrest in the Gaza Strip stretched into a second week despite efforts by Yasser Arafat (search) to defuse mounting discontent with his leadership.

Arafat, in his first public appearance since the outbreak of demonstrations against his regime, denied he is facing a crisis and renewed his pledge to give more authority to his prime minister.

But the continuing violence in Gaza signaled skepticism over Arafat's promises of reform, and there was no indication that his standoff with Prime Minister Ahmed Qureia (search) and the Palestinian Cabinet was easing.

"No, no, there is no crisis," said Arafat, facing a bank of microphones after meeting Arab diplomats in his headquarters.

"There is no problem over the interior minister. There is a proposal by the Palestinian Legislative Council (search) to carry out some changes within the Cabinet, and we gave our approval for such changes," the Palestinian leader said.

In the northern Gaza Strip town of Beit Hanoun Israeli troops shot dead a 16-year-old Palestinian standing at the window of his home, paramedics said. The army said it was checking the report. The military said Palestinian gunmen were shooting, but that troops did not return fire because darkness made it difficult to identify the target.

Also, Israel's public security minister warned that Jewish extremists could attack a site holy to Muslims and Jews, hoping to provoke violence and wreck Israeli plans to withdraw from the Gaza Strip and parts of the West Bank.

"We feel that the level of the threat to the Temple Mount, in the sense of an attack by extremist Jewish fanatics in order to reshuffle the cards, to be a catalyst for change to the whole political process, has risen in recent months, or weeks, higher than it has ever been," Tzachi Hanegbi told Israel's Channel Two television.

The Al-Aqsa compound stands on what Jews know as Temple Mount, the site of the biblical Temple and Judaism's most sacred shrine. Some Jews believe that destroying the mosques and rebuilding the ruined Temple will bring about the coming of the Messiah.

Arafat pledged to empower the Cabinet last week after the Palestinian parliament, in a rare show of defiance, asked him to appoint a new Cabinet with authority to deal with the demonstrations and kidnappings that spread from Gaza to the West Bank.

Arafat has refused to accept the resignation of Qureia, who complained that he lacked the tools to deal with the unrest or the corruption that is rife in the Palestinian Authority.

Arafat made light of the standoff with Qureia.

"The prime minister has the full right to propose anything he wants, and whatever is suitable for him," Arafat said. "I will support whatever he decides. I highly and fully trust him."

In Gaza on Saturday, militants torched an empty Palestinian police station south of Gaza City before dawn in the town of Zwaida, 4 miles south of Gaza City, pouring gasoline on mattresses and blankets and setting the building on fire.

The fire damaged an upper story of the town council, which had recently been renovated with donations from the Danish government.

No one was injured, officials said, but police files, computers and communications equipment were destroyed. No group immediately claimed responsibility.

Ahmed Abu Zaid, the mayor of the town, said the purpose of the raid appeared to be to "spread lawlessness and terror among the people."

As town residents gathered to view the damage, Abu Zaid said the incident showed the need for measures to "make the people feel that there is law and order."

"The police cannot even protect their own station. Who's going to protect us," said one angry resident, accosting the mayor.

Hassam Abu Zaid, the local leader of Arafat's Fatah political movement, called the raid a "shameful act," and said, "we call on the president (Arafat) to make sure that law and order are being implemented, and that good leaders and good commanders are fulfilling their duties."

In Khan Younis, in the southern sector of Gaza, militants of the Al Aqsa Martyrs' Brigades took over the building of the local administration, demanding the reinstatement of 50 comrades fired from their security jobs, a member of the group said.

"We want to confirm our loyalty to Arafat, as the leader and commander of the Palestinian people," said the militant who identified himself only as Abu al-Haj. "We still call on the president to fire all the people involved in corruption," he said, before evacuating the building and ending the siege.

Al Aqsa Brigades is affiliated with Fatah, but its younger members have been angered by the monopolization of power in Gaza by Arafat's associates, most of whom are from an older generation raised in exile rather than under Israeli occupation.