A Hamas spokesman said Wednesday the Islamic militant group would not renew an informal nine-month-old truce, which expires at the end of the year, after Israel killed one of its leading activists in an air strike in Gaza.

The truce was brokered by Egypt, and that country is expected to invite militant groups, including Hamas, to Cairo in coming weeks to discuss extending the agreement.

The announcement came after a Palestinian legislator, Ziad Abu Ziad, told Army Radio on Wednesday that Israel rejected the Palestinian Authority's offer to stop targeting militants if they would lay down their arms.

A senior government official said Israel tried that in the past, but militants simply lay low for a while, then resumed their activity later. "We don't want them to lay down arms, we want them to be arrested," he said, speaking on condition of anonymity because he is not authorized to discuss policy on the record.

Foreign Minister Silvan Shalom said Wednesday that Israel will halt its assassinations of commanders of Palestinian terror organizations the day that Palestinian Authority Chairman Mahmoud Abbas begins to curb terrorism originating in the Gaza Strip.

"It is not our goal to continue this activity," Shalom said, referring to the assassination policy. "It can end immediately."

"It's all up to Abu Mazen [Abbas]. "If Abu Mazen takes the strategic decision which he still refuses to take and acts against the infrastructure of terror... (our activity) in Gaza will end the same day," Shalom said.

"We are in a state of constant war... We said that any activity emanating from Gaza would be met by a very severe reaction by Israel. As there is still rocket firing from Gaza, these things cannot go without reaction," Shalom told Israel Radio.

Ra'anan Gissin, an aide to Prime Minister Ariel Sharon, said, "We're not going to pay with Israeli lives while they are experimenting in trying to reach understandings with terror organizations and they continue to carry out terror attacks against us."

Hamas said Wednesday that it remains committed to an informal truce with Israel reached in February. At the same time, it said it reserved the right to retaliate against Israel for killing one of its weapons experts.

"Hamas is committed to the calm," Hamas spokesman Sami Abu Zuhri said Wednesday. "But our people have the right to respond to the Israeli crimes committed against our civilians and our holy warriors."

Hamas and other Palestinian factions interpret the cease-fire to mean they can respond to individual Israeli attacks while remaining committed to the truce.

In an air strike in Gaza on Tuesday, missiles pulverized a car carrying Hassan Madhoun, a leader of the Fatah Al Aqsa Martyrs Brigade, and Fawzi Abu Kara of Hamas, a specialist in the manufacture of rockets and explosives.

Madhoun, the main target of the raid, was a top fugitive whom Israel has accused of planning deadly bombings at Ashdod port and the Karni crossing between Gaza and Israel. Ten Israelis were killed in the Ashdod attack in 2004. He was also responsible for attempting to send a female suicide bomber from Gaza to Be'er Sheva's Soroka Medical Center.

Israel had been pressuring Abbas to arrest Madhoun since the beginning of the year, providing the gunman's address and cellular phone number. At Sharon's urging, U.S. Secretary of State Condoleezza Rice also brought up Madhoun with Abbas, Israeli officials have said.

"This is an open war," said Hamas spokesperson Mushir al-Masri after the air strike that killed Madhoun and Abu Kara. "They (the Israelis) are going to pay a heavy price for their crimes... We will not stand handcuffed."

Also Wednesday, nine Hamas members jailed in Israel as security prisoners said they were leaving the militant group to join al-Qaida. A Prisons Service spokesperson said the prisoners are changing loyalties because they feel Hamas does not commit a sufficient number of armed attacks against Israel.

The announcements came against the backdrop of an IDF artillery bombardment of areas in the nothern Gaza Strip used by militants to launch Qassam rockets into Israel. The shelling came in retaliation for a mortar shell fired earlier at Kfar Aza from the Gaza Strip. No injuries or damage was reported.

A spokesman from the Al-Aqsa Martyrs Brigades, with whom Madhoun had previously worked, said, "our retaliation will be equal to the size of the crime." The spokesman identified himself as Abu Ahmed, and was masked and carried an M-16 assault rifle at the time of his comments.

"This assassination will open the gates of hell on the enemy," Islamic Jihad, a group sworn to Israel's destruction, said after Tuesday's strike.

Dozens of angry militants rushed to the local hospital where the bodies were taken. The gunmen fired into the air and chanted "revenge, revenge."

The two men were travelling in a car with a red Palestinian Authority security licence plate, witnesses said. The missiles hit the car only a few minutes after a convoy carrying Palestinian Authority Chairman Mahmoud Abbas passed through the area, according to Palestinian security officials.