GAZA CITY, Gaza Strip - A Hamas military commander was killed Tuesday in a shootout with Fatah gunmen shortly before the leaders of the two groups met to try to bridge their differences over a power-sharing deal.

Palestinian Prime Minister Ismail Haniyeh attends a cabinet meeting at his office in Gaza March 12, 2007. [Reuters]

At least seven people were wounded in the gun battle in Gaza City.

A spokesman for Hamas' military wing, Abu Obeidah, blamed the killing of Allah Haddad, 35, on the Preventive Security force loyal to President Mahmoud Abbas of Fatah.

The security force confirmed that one of its people was wounded in a shooting incident, but said the matter was a family feud and that the officer was not on duty. The battle erupted after members of a Gaza family tried to recover a stolen car, and its passengers - members of a Hamas militia - opened fire, the force said.

Deadly violence between the two factions has flared occasionally since they reached a power-sharing deal last month. The accord brokered in Saudi Arabia was meant to halt months of fighting in which more than 130 people were killed. But tensions have remained high.

The two factions are now working out how to implement the deal, and shortly after the shooting, Abbas and Palestinian Prime Minister Ismail Haniyeh of Hamas met in Gaza City to try to arrive at a consensus candidate for interior minister. The interior minister oversees some security forces, and disagreements over this key appointment have held up the formation of a government.

The meeting ended without agreement on a candidate, but the two sides agreed to continue consultations.

Abbas hopes the coalition government will also help to end an international boycott of the year-old Hamas government and lead to a resumption of peace talks with Israel.

The international community has said it would withhold judgment until it sees the new government's political program. However, the coalition, in deference to Hamas, is unlikely to agree to international demands to recognize Israel and renounce violence.