Top Israeli and Palestinian officials debated issues crucial to a three-month truce long into the night, ignoring for now infighting that has jeopardized Palestinian Prime Minister Mahmoud Abbas' influence.

Israeli Defense Minister Shaul Mofaz and Palestinian security chief Mohammed Dahlan met late Thursday at an Israel-Gaza crossing point to discuss demands that Israel release thousands of prisoners and Israel's insistence that the Palestinians crack down on violent groups during the truce.

Islamic groups called the three-month truce on June 29, and the secular Fatah movement, controlled by Yasser Arafat, declared a six-month cease-fire.

Israel Radio reported that Mofaz demanded the Palestinians take action against the militant groups. The radio quoted him as saying that progress toward peace would be otherwise impossible.

Israeli Prime Minister Ariel Sharon addressed the issue in a speech to US Jewish activists. The Palestinians must "act and struggle against terror, dismantling terror organizations, collecting their weapons," Sharon said.

Abbas refuses to confront the militants for fear of triggering a civil war, preferring to negotiate an end to their attacks against Israelis.

A Palestinian security official, speaking on condition of anonymity, said that in the late-night meeting, Dahlan demanded Israel release all 7,000 prisoners it has in custody, especially about 450 who have been in prison for several years.

Also, the official said, Dahlan asked the Israelis to remove roadblocks in the West Bank and prepare to pull out of additional West Bank cities and towns.

Militant groups have threatened to cancel the truce if Israel does not free all the prisoners, and they demand that Abbas press the issue harder with the Israelis.

Israel, noting that releasing prisoners is not part of the US-backed "road map" peace plan toward Palestinian statehood, has agreed to release only a few hundred as a goodwill gesture.

As the talks progressed, the military said three Palestinians crossed a security fence and tried to enter an Israeli village outside northern Gaza. Separately in northern Gaza, a Palestinian crossed the fence and approached another village.

Soldiers stopped the attempts, wounding two Palestinians and capturing all four. Their motives were not clear, and it was not immediately known if they were armed. Palestinians often try to slip into Israel to look for work, while others go to attack Israelis.

The Mofaz-Dahlan meeting was in doubt through the day because of Palestinian infighting, partly over the prisoners issue.

Arafat appeared to be trying to reassert more control over Palestinian diplomacy through his Fatah movement, as Palestinian officials and militants criticized Abbas over his handling of the prisoner issue.

A statement from the Fatah Revolutionary Council said the advisory body would meet regularly "to enable (it) to assume its leading role in drawing up the movement's policies and follow up the implementation of its decisions," the Palestine Media Center said.

Under the law creating the position of premier, passed in April, Fatah retains the final say in talks with Israel. The latest Fatah statement, pledging constant supervision of Abbas, indicated that Arafat will stay closely involved, despite an Israeli and US boycott of him over charges that he is tainted with terrorism.

Earlier this week, Abbas threatened to resign as prime minister unless Fatah endorsed his handing of contacts with Israel. However, on Wednesday he said he was not leaving that post.

Media reports say Arafat is also unhappy with Dahlan's growing power. Arafat vetoed Dahlan's appointment as interior minister, forcing his relegation to the post of junior minister, but Abbas has turned control of the Interior Ministry, which commands security forces, over to Dahlan anyway.

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