Abbas also said he has revived the Palestine Liberation Organization negotiating department, signaling he would pursue peace talks with Israel.

However, his decision to call elections is fraught with risks.

It immediately hardened the lines between the rival camps, at a time when factional fighting threatens to escalate into civil war. In recent days, Fatah-allied security forces and Hamas gunmen clashed in the streets, and Hamas accused an Abbas ally of trying to kill its prime minister.

Fatah and Hamas supporters traded fire and hurled stones at each other in towns across the Gaza Strip after Abbas' announcement. Eighteen people were wounded, including seven who were shot, according to reports from hospital officials and Hamas. The confrontations involved just a small number of the tens of thousands who rallied across Gaza in support for each side.

In his speech, Abbas said Hamas was ignoring reality. At one point, he warned Hamas not to try to "terrorize" him by claiming its rule was God's will.

Hamas leaders said the speech's confrontational tone made it clear Abbas was no longer a partner. "Abu Mazen is not part of the solution anymore. He is part of the problem now," said Ahmed Yousef, senior adviser to Prime Minister Ismail Haniyeh of Hamas.

Yousef said Hamas would try to block the election. "We will challenge him everywhere," he said.

Elections could be stripped of legitimacy if boycotted by Hamas and other political factions. The Popular Front for the Liberation of Palestine, a smaller PLO faction that had participated in parliament elections in January, said it rejected Abbas' call for early elections.

Several Palestinian faction leaders based in Syria also rejected Abbas' decision.

"Any step outside the context of the laws is rejected by us all and this is not just the position of Hamas," said Damascus-based Hamas leader Khaled Mashaal. "The position that we have expressed today is the position of the 10 Palestinian factions whose history, performance and weight on the ground is well-known."

Islamic Jihad leader Ramadan Shallah, who met with Mashaal in Damascus, urged Hamas and Fatah to reach an agreement, calling Abbas' decision "lawless."

"We believe that such a call will regrettably take us to the unknown," Shallah said in an interview with the Al-Jazeera satellite station.

Abbas, 71, was elected president in 2005. If he does not run again - he has said he would not seek another four-year term - Palestinian moderates would not have a strong candidate.

Hamas, if it decided to participate, could field Prime Minister Ismail Haniyeh, according to polls the most popular politician after Abbas.

During times of political turmoil, any efforts to resume peace talks with Israel would likely be frozen. In recent weeks, Israeli Prime Minister Ehud Olmert has said he was willing to give up large parts of the West Bank in a peace deal, and that he was ready to talk peace.

Israeli government spokeswoman Miri Eisin said Olmert "respects Abu Mazen and hopes that he will have the capability to assert his leadership over the Palestinian people, and to bring about a government that will comply with the international community's principles."

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