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Hamas police in Gaza broke into a warehouse full of United Nations humanitarian supplies and seized thousands of blankets and food packages, a United Nations spokesman said Wednesday, a rare public clash between the international agency that feeds much of the territory and the militant group that rules it.

The incident highlighted difficulties facing donors seeking to bypass Hamas while helping Gazans survive and rebuild after Israel's three-week military offensive.

"Hamas policemen stormed into an aid warehouse in Gaza City Tuesday evening and confiscated 3,500 blankets and over 400 food parcels ready for distribution to 500 families," said United Nations Relief and Works Agency spokesman Christopher Gunness.

"They were armed, they seized this, they took it by force," Gunness said, terming the incident absolutely unacceptable.

Police seized the aid after UNRWA officials refused to voluntarily hand it over to the Hamas-run Ministry of Social Affairs, he said. Similar aid packages were distributed to 70,000 residents over the past two weeks, Gunness said.

Ahmad Kurd, the Hamas official in charge of the ministry, did not deny the aid was seized. Other Hamas officials defended their actions.

Hamas spokesman Taher Nunu demanded an apology and said UNRWA was spreading false news. Ihab Ghussein, a spokesman for the Interior Ministry, said the incident occurred because the UN was storing the blankets in an area not authorized to be distributed.

UN officials said the aid was kept in a local storage facility because the organization's regular warehouses were full. The UN, human rights groups and Palestinians have often complained that a blockade by Israel and Egypt has left Gaza critically short of vital supplies.

Senior UN official John Ging said aid distribution would continue. "We are not going to punish the refugees for the irresponsible actions of a few," Ging said.

"The stakes are very high," Ging said. "Whatever donors give us by way of assistance has to be fully accounted for".

The ability of Hamas to provide aid is crucial to maintaining support for its rule in the territory.

Gaza residents are facing more hardship since Israel's devastating three-week military offensive, which ended Jan. 18. The operation, aimed at halting rocket fire by Palestinian militants, killed 1,300 including hundreds of civilians and left thousands destitute after their homes were damaged or destroyed.

Kurd said the Hamas government had already distributed $50 million in emergency relief to residents and promised additional payments for hardship cases.

On Wednesday, Benjamin Netanyahu, the hard-line candidate for prime minister who is leading in polls a week before Israel's election, charged that Israel's offensive was stopped too early. He said Wednesday that the military should have been allowed to put an end to Hamas arms smuggling from Egypt. He also said, "There is no choice but to uproot the Iranian-backed regime in Gaza."

The United Nations is expected to take a leading role in rebuilding Gaza, because Israel and the international community will not deal with Hamas, labeling it a terror organization.

Some international donors have expressed concern that funds meant to rebuild Gaza could fall into the militant Islamic group's hands, and the UN had been trying to calm those fears.

"We are very concerned, but this is an isolated incident, we hope," said Alix de Mauny, a spokeswoman for the European Commission, one of the largest donors to the Palestinians. "We will react accordingly if this develops beyond an isolated incident," de Mauny said. The EC contributed $626 million to the Palestinians in 2008.

Israeli officials say the incident vindicated their long-standing claims that Hamas routinely confiscates aid meant for needy Gazans.

"We have said in the past that we know Hamas is stealing humanitarian aid and donations from international organizations," said military spokesman Peter Lerner.

However, Gunness said this was the first time Hamas seized UNRWA supplies. "Does anyone really think that the Americans, who are our single largest donor, or the Europeans, who are our largest multination donor, would give us aid in the generous way they do if they thought that aid would go to terrorists?" Gunness asked.

The West Bank-based government of Palestinian President Mahmoud Abbas, a fierce rival of Hamas, is also sending $600 million in aid, hoping to earn the loyalty of Gaza residents. Hamas expelled forces loyal to Abbas when it overran Gaza in 2007.

Palestinian Prime Minister Salam Fayyad, who heads Abbas' Western-backed government, said the project would cover all houses destroyed or damaged during the Israeli military offensive.

"The amount of the project is $600 million. Most of it will come from donors," Fayyad said in a speech, adding that the details would be announced in the coming days.

Egypt is to host an international conference in coordination with Abbas's Palestinian Authority on March 2 on Gaza reconstruction, whose cost has been estimated at $2 billion. Saudi Arabia has said it would donate e1 billion.

Last week, Egyptian Foreign Minister Ahmed Aboul Gheit urged Europe to help with fast aid for the Gaza Strip, saying the reconstruction meeting would require damage assessments and the support of the European Union, the United Nations and others.