More than two weeks of heightened tensions in Hebron boiled over Tuesday, with dozens of radical Jewish settlers rioting in the southern West Bank city, dpa reported.
The settlers threw stones at Palestinians and at Israeli police and soldiers, spray-painted slogans and damaged graves.
Local Palestinians also hurled stones at the settlers, seriously injuring an Israeli teenager who was hit in the head.
Dozens more were lightly injured, with Palestinians reporting at least 36 wounded and settlers some 18.
An Israeli police spokesman said two settlers were arrested.
The rioting erupted after some 1,500 Jewish settlers arrived in Hebron late Monday amid rumours that the Israeli authorities were about to forcibly evacuate a disputed house occupied by settlers.
Israel's supreme court on November 16 ordered the Israeli government to evacuate what is known in the Israeli media as the "House of Contention."
Since then hundreds of hardline and radical Israelis have arrived at the house as "reinforcements," vowing to prevent the evacuation. Israeli Defence Minister Ehud Barak in turn has vowed not to bow to the threats and carry out the court order at an unexpected time.
Jewish settlers occupied the house in early 2007, saying they were the tenants of an American Jew who purchased it and that they have documents proving it. Its Palestinian owner however denies this.
The Israeli supreme court in its November 16 ruling ordered the house be handed over to the state until a lower court rules about its rightful owner.
Hebron's settlers are considered among the most radical in the West Bank. The historic Biblical city is divided into an Israeli- and a Palestinian-controlled part under a 1997 agreement. Some 600 to 800 Jewish settlers, heavily guarded by Israeli soldiers, live among a Palestinian population of some 200,000 in the what is the largest city in the West Bank.
The Israel Air Force meanwhile launched an airstrike in the southern Gaza Strip Tuesday afternoon, killing two militants and injuring at least two others, hospital officials said.
An Israeli army spokesman said the airstrike was launched at a group of militants who had just fired a mortar shell toward Israel's border crossing with the southern Gaza Strip of Kerem Shalom.
The armed wing of the radical Islamist Hamas movement ruling Gaza said its militants fired six such mortar shells at the crossing since the morning.
Israel has imposed a near-total closure of the Gaza Strip for 27 days now, in response to renewed rocket and mortar fire from the strip, which followed a November 4 clash between Israeli soldiers and Palestinian militants which left five Hamas gunmen dead.
Since then, Israel has all but completely shut its borders with Gaza, so far allowing in only three convoys amounting to some 104 trucks with humanitarian aid and medical supplies, in addition to limited amounts of industrial diesel and cooking gas.
The new cycle of violence has all but shattered a five-month-old ceasefire brokered by Egypt.
The truce is to expire December 19. Hamas began talks with other militants factions active in Gaza, which were expected to last into next week, on whether to extend the truce, meeting with the Islamic Jihad first on Tuesday, spokesman Ayman Taha said.
A Qatari ship with one ton of medical aid meanwhile set sail from the Cyprian port city of Larnaca and was due to arrive in Gaza later this week, a Palestinian official said.
"The ship also carries representatives of relief agencies and journalists," Jamal al-Khodary, who heads the strip's Popular Committee Against the Siege of Gaza, told reporters.
His announcement came one day after Israel ordered a Libyan aid ship heading for Gaza to turn around. The Libyan voyage was the first attempt by an Arab state to defy the Israeli closure.
Israeli soldiers also fatally shot a Palestinian militant in the West Bank city of Nablus late Monday as they attempted to arrest him.