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JEBALIYA REFUGEE CAMP, Gaza Strip (AP) _ Despite U.S. truce efforts, Israel on Tuesday intensified its largest military offensive since 1982, killing 28 Palestinians in raids of sprawling refugee camps, the West Bank's commercial center and other targets.

Most of Israel's combat soldiers _ a force of many thousands _ are now deployed in the Palestinian territories, security sources said. Israel's deputy defense minister, Dalia Rabin-Pelossof, said she expected the operation to stop by the time U.S. envoy Anthony Zinni arrives in the region Thursday.

As the fighting raged, two Israeli Cabinet ministers from the ultra-nationalist National Union party submitted their resignation, saying they felt Prime Minister Ariel Sharon's actions against the Palestinian Authority were not tough enough. Sharon retains his parliamentary majority despite the protest.

On Monday evening, about 50,000 Israelis demonstrated in Tel Aviv, calling for stiffer action against the Palestinians. ``Defeat Arafat, destroy terror,'' one of the banners read.

In Tuesday's fighting, the Jebaliya refugee camp _ the largest and most crowded with 100,000 residents _ came under heavy Israeli fire from tanks and helicopter gunships during a three-hour incursion. The camp was plunged in darkness.

Hundreds of Palestinian gunmen exchanged fire with Israeli forces, and at least 18 Palestinians were killed and 75 wounded by Israeli fire, doctors said. Many civilians, some in their pajamas, fled the fighting, moving toward nearby Gaza City on foot and in donkey carts. ``They are killing us,'' said Laila Ayoub, 38, carrying a baby girl. ``They used helicopters to fire on us while we were leaving.''

Israeli tanks also took control of the West Bank town of Ramallah and the adjacent Amari refugee camp. Five Palestinians, including two policemen, two unarmed guards at the parliament building and a taxi driver, were killed by Israeli fire.

Several tanks were deployed outside the headquarters of Palestinian leader Yasser Arafat. The takeover came only a day after Israeli Prime Minister Ariel Sharon announced that Arafat, who had been confined to Ramallah for the past three months by Israel, was free to move in the West Bank and Gaza Strip.

In an angry response, a senior Arafat adviser, Ahmed Abdel Rahman, said Tuesday that ``talking peace with the Israelis was a historic mistake.'' Abdel Rahman said he was confined to his home because of heavy Israeli tank fire.

Israeli government spokesman Dore Gold said Israel was showing restraint and ``not using the full strength of its air force against the refugee camps.''

Israeli Foreign Minister Shimon Peres, who has maintained contact with Arafat, criticized the military strikes, saying that ``we have to be careful not to humiliate not to treat human beings with contempt,'' Peres said. ``I don't know if Israel has humiliated Arafat. I do know that Arafat feels humiliated.''

Several hours after taking up positions in Ramallah, Israeli troops announced over loudspeakers that boys and men between the ages of 16 and 40 must come out of their homes and surrender to Israeli forces. Local TV stations urged the men not to comply.

Since the weekend, Israeli forces up rounded up nearly 2,000 Palestinians in similar arrests sweeps in three other West Bank locations, in hopes of tracking down suspected militants.

Asked whether Israel would keep up the offensive in Zinni's presence, Rabin-Pelossof, the deputy defense minister, said: ``I assume that when Zinni is here, this will not be the way things are done.''

Israel's offensive began last week, after a string of attacks by Palestinian militants on Israeli civilians. Since the beginning of March, 159 Palestinians and 52 Israelis have been killed, making it the bloodiest period since fighting began in September 2000. One Israeli was killed Tuesday, in a West Bank shooting ambush.

Israeli military commentators said the current offensive is the largest-scale Israeli military campaign since the 1982 invasion of Lebanon.

On Monday, Israeli troops swept through the West Bank town of Qalqilya and the Dheisheh refugee camp, questioning more than 1,100 Palestinians and confiscating weapons and explosives. The army left Dheisheh on Tuesday.

The Israeli military said the Jebaliya incursion was aimed at finding rockets, destroying weapons factories and arresting suspected terrorists.

Troops destroyed four buildings in the camp, including two metal workshops and the home of Ibrahim Hassouna, a member of the Al Aqsa Brigades militia who killed three Israelis in a shooting attack on a Tel Aviv restaurant last week before being killed by police. The army said the metal workshops produced mortar shells.

Abdel Aziz Rantisi, a leader of the Islamic militant group Hamas, threatened more attacks. ``We have no choice but to kill the occupier, to kill him everywhere, every village and every city. There's no other way to defend ourselves,'' he said.

Elsewhere in the Gaza Strip, Israeli helicopters shelled a metal workshop and a Palestinian security installation in the Khan Yunis refugee camp, killing four Palestinian civilians, including three members of a family.

In the Deir el Balah refugee camp, Israeli gunboats and helicopters shelled a Palestinian security installation in the town of Deir el Balah, killing a policeman.

In Ramallah, the administrative and commercial center for the West Bank, tanks moved in after a daylong buildup of forces on the outskirts. A senior Israeli army commander, speaking on condition of anonymity, said Israeli forces were forming a protective wall between Israel and militiamen in the Ramallah area.

A Danish aid worker, Christian Jessen, said there was eerie quiet in the center of Ramallah. ``The main street is open, the Christian quarters are open. Men are sitting on the corner drinking tea and wondering what is going to happen,'' he said.

However, in Manara Square in the center of town, the body of a Palestinian man was found hanging by a rope from a statue. Palestinian security officials identified him as Raed Odeh from the Amari camp. The Al Aqsa Brigades said militiamen killed him on suspicion he helped Israeli forces kill one of their senior members earlier this month.

Foreign reporters working in a hotel across from the Amari camp came under fire from Israeli soldiers. The military said it was working to stop the gunfire.