A Palestinian gunman opened fire at a packed banquet hall in northern Israel Thursday night, killing six people and wounding 30 others, police said.

People in the hall pushed the attacker outside, where he was shot and killed by police, bringing the death toll to seven, said police Commissioner Shlomo Aharonishki. A militant group with links to Palestinian leader Yasser Arafat claimed responsibility for the attack.

Hours later, Israeli F-16 warplanes attacked the Palestinian government headquarters in the West Bank town of Tulkarem in retaliation, destroying the large compound, killing a Palestinian policeman and injuring about 30.

About 100 people were inside the banquet hall celebrating a bat mitzvah, or Jewish coming of age ceremony, at the time of the attack. Several beat the attacker with a chair and bottles and later dragged him outside where he was shot by police. Among the dead was the grandfather of the girl celebrating her bat mitzvah.

"The terrorist came in the main door with an M-16 [assault rifle] at the height of the event and started shooting everywhere," said Shimon Asraf, one of owners of Armon David or David's Palace hall.

Moti Hasson said he was dancing when he heard the shooting.

"When I saw the Arab I ran toward him with a chair," said Hasson, a truck driver. "I threw the chair at him."

Hasson said he hit the attacker in the face with the chair while other people threw bottles at him. Others dove under tables. Some people shouted in fright.

After Hasson hit the attacker, the man's gun jammed.

"His gun just stopped shooting," said Hasson, who was standing outside the banquet hall wearing a sweat shirt and carrying a bag of the clothes he wore during the attack, which were soaked with the gunman's blood.

Eliahu Iskov said he saw the attacker on the floor, apparently unconscious from the beating, and grabbed him by the foot to drag his body outside of the banquet hall.

"I thought that he had explosives strapped to his body and would explode," Iskov said. "I though if he exploded it would be best if he exploded outside."

Other people pulled tablecloths from the banquet tables and wrapped the wounded in them so they could quickly take them outside in case there were explosions.

The attacker was later shot by police, Aharonishki said. Police apparently feared that the attacker's ammunition belt contained explosives.

At David's Palace, a two-story building with a brown facade, workers were washing blood off the pavement a few hours after the attack.

The Al Aqsa Brigades, a militia linked to Arafat's Fatah movement, claimed responsibility for the attack in a phone call to The Associated Press.

It was the deadliest single attack in the region since Arafat announced a cease-fire Dec. 16, following more than a year of Israeli-Palestinian violence that had left hundreds dead on both sides.

The group said that Abed Hassouna, from a village near the Palestinian town of Nablus, carried out the attack to avenge the death of Raed Karmi, the militia's leader in the town of Tulkarem. Hassouna had been a police officer for the Palestinian Authority for a year, serving at a checkpoint in Nablus, but left the force two years ago, residents of his village said.

Karmi was killed in a bomb blast earlier this week that is widely believed to have been carried out by Israel. Militants from the group have vowed to avenge his death despite Arafat's cease-fire call.

In Tulkarem, about a dozen Al Aqsa Brigades militants marched through the streets after the attack, shooting into the air in celebration.

At about 5:15 a.m. Friday, an Israeli F-16 warplane attacked the government headquarters in Tulkarem, destroying part of the compound and killing a policeman, said the local police chief, Mahmoud Awadallah. About an hour later, the warplane returned, dropping seven more bombs that razed the building, Awadallah said.

Nineteen prisoners were taken out of the compound before the second attack, police said. Of those, 10 suspected collaborators with Israel were moved to a different detention center, while nine suspected Islamic militants were released, Palestinian intelligence officials said.

The northern city of Hadera is located near the line separating Israel from the West Bank and has been the scene of several Palestinian bombings in recent months.

Israeli officials blamed Arafat for the attack, saying he is doing little to stop extremists.

Arafat "hasn't done one thing to stop this," said Raanan Gissin, an adviser to Prime Minister Ariel Sharon. "We will do what he failed to do. We will arrest those who need to be arrested. We will stop those who need to be stopped."

In Washington, the State Department called the banquet hall attack a "horrific act of terrorism."

"As leader of the Palestinian Authority, the Palestinian Liberation Organization and Fatah, Chairman Arafat must take immediate action against those responsible for these acts and confront the infrastructure that perpetuates terror and violence," Philip Reeker, a department spokesman, said in a statement.

Fox News' Jennifer Griffin and The Associated Press contributed to this report.