TEL AVIV, Israel (AP) _ With a barrage of bitter accusations, Israeli Prime Minister Benjamin Netanyahu on Saturday fired his defense minister after he emerged as a possible rival in upcoming elections.

Yitzhak Mordechai had conducted negotiations with a new centrist party and was promised the top slot if he left the ruling Likud Party. His departure is seen as a blow to Netanyahu's chances for re-election May 17.

Netanyahu said he offered the defense post to his former mentor, Moshe Arens, who is challenging the prime minister for leadership of the Likud. The primaries are to be held Monday.

Arens, 73, who served as defense minister in a previous Likud government, said he would consider the offer after Monday's vote.

Mordechai was the most popular minister in Netanyahu's government, and surveys have indicated he would beat Netanyahu in the race for prime minister.

As leader of the centrist party, Mordechai, who is of Kurdish ancestry, would appeal to voters with family origins in the Arab world _ a mainstay of Likud support. He was seen as the strongest proponent for the peace process with the Palestinians in Netanyahu's government.

The two men traded bitter accusations Saturday night.

Netanyahu claimed Mordechai was being driven by personal ambition, while Mordechai said Netanyahu was lying and unworthy of being the leader of the Israeli people.

In a hastily arranged news conference after briefing Likud ministers of his decision, Netanyahu read from a letter he had sent Mordechai that claimed the minister had conducted simultaneous negotiations with him and the centrist party.

Netanyahu said Mordechai demanded assurances he would be named defense minister in the next Likud government and turned to the centrist party when Netanyahu refused to make such a promise.

``In recent days and weeks, I have seen that your personal ambition is stronger than anything else,'' Netanyahu said.

At the time of Netanyahu's announcement, Mordechai was meeting in his home with the co-founders of the new centrist party, including former army chief Amnon Lipkin-Shahak, to discuss the group's platform.

Mordechai responded sharply.

``The prime minister sent me a letter full of lies, slander and inaccuracies that are appropriate for a petty politician,'' Mordechai said, shaking with anger.

``I'm sorry to say that the prime minister is no longer worthy of my personal support or, I suppose, the support of the Israeli people,'' Mordechai said. ``Israel deserves a better leadership.''

In an apparent reference to the suspended peace process with the Palestinians, Mordechai said: ``Netanyahu chose to endanger everything we achieved because of his political objectives.''

Netanyahu had suspended the Wye River peace agreement last month, citing what he said were violations by the Palestinians. At the time, hard-liners had threatened to topple his crumbling coalition if he carried out the accord.

Netanyahu's decision to fire Mordechai will take effect within 48 hours.

Mordechai is the fifth minister appointed by Netanyahu that has quit or been dismissed in Netanyahu's 2 1/2-year tenure as prime minister. Four were ministers serving in top positions of defense, foreign affairs and finance.

``Mordechai joined the wide circle of respected people ... that had enough of Prime Minister Netanyahu leading the country to a dead end,'' opposition Labor leader Ehud Barak told Israel Radio.

Meanwhile, Palestinian leader Yasser Arafat will travel to Europe and the United States to ask leaders to pressure Israel to implement the latest peace agreement, an adviser said Saturday.