HIGHLIGHTS:Car Explodes Before Impact With Dancing Club||Palestinian Opposition Leaders Describe Elections Planned by Arafat as Irrelevant||Israeli Occupation Forces Destroy Three Factories in the Gaza Strip ||STORY: A suspected Palestinian militant tried to ram an explosives-laden car into a crowded Tel Aviv nightclub on Friday but was killed when an Israeli security guard opened fire and the vehicle blew up before impact.

The apparent bomb attack was the latest in a fresh cycle of tit-for-tat violence that has overshadowed Palestinian leader Yasser Arafat's pledge to overhaul his beleaguered Palestinian Authority and hold elections by early next year.

Three passersby were wounded by the blast, Israeli police said.

Witnesses said people ran in panic as the car, which came to rest just a few meters from the club's main entrance, was enveloped in flames.

There was no immediate claim of responsibility for the attack, the third inside Israel in little more than four days.

The al-Aqsa Martyrs Brigades, which has links to Arafat's Fatah movement, had vowed to avenge Israel's killing of a commander, two fighters and a civilian near the West Bank city of Nablus in a missile strike on Wednesday night.

GAZA INCURSION

Late on Thursday night, Israeli tanks rolled into Palestinian-controlled territory, blowing up three factories in the Gaza Strip. (Read photo caption)

The Israeli army alleged that one of them made rockets that had been used to fire at Jewish settlements.

Palestinian officials said there were no casualties.

The occupation army also said that it detained five Palestinians near the West Bank city of Hebron suspected of involvement in "terrorist activities".

On Thursday, 22 suspected Palestinian militants were arrested in Hebron and villages around Jenin.

And two Palestinians were killed when an explosion ripped through a house in the Balata refugee camp near Nablus on Thursday,
Palestinian medical sources said.

The cause of the explosion was not known.

The Israeli occupation army said it did not know about the blast.

It came a day after Israeli troops killed a leader of al-Aqsa Martyrs Brigades and two other Palestinian militants in the camp.

Israeli occupation troops guarding a base on the Egyptian border killed a 33-year-old in the southern Gaza Strip on Thursday. Witnesses said the shooting was unprovoked. Israeli occupation sources claimed the man had thrown a grenade at an army patrol.

ARAFAT SETS TIME FRAME FOR PRESIDENTIAL & LEGISLATIVE ELECTIONS

Arafat, under fierce pressure to reshape his crumbling administration, set a timeframe for new elections for the first time on Thursday.
The world community may welcome his efforts to set his house in order, but Palestinian Opposition leaders decried the Palestinian Authority as an Israeli tool and rejected voting as irrelevant.

Israeli Prime Minister Ariel Sharon has demanded reform and new leadership of the Authority as pre-conditions for peace talks, angering Palestinians, who reject Israeli interference.

In an interview with Reuters on Thursday, Arafat promised parliamentary and presidential elections in the winter and regional and municipal polls this year.

But he questioned whether fair elections could take place under stringent travel restrictions Israel has imposed on Palestinians since the start of the uprising.

OPPOSITION FROM MILITANT GROUPS

Sheikh Ahmed Yassin, spiritual leader of Hamas, an Islamic group sworn to Israel's destruction, said Israeli occupation of Palestinian areas must end before there can be elections.

He defended Resistance bombings as the only way Palestinians could strike back against Israel's advanced weaponry.

In Damascus, Hamas politburo chief Khaled Mishal denounced Arafat and his colleagues. "These people with their swollen pockets, who have lived on the suffering of the Palestinian people, are not fit to reform," he told Reuters.

His comments echoed growing complaints by ordinary Palestinians about corruption and mismanagement.

Arafat said he was making a "100 percent effort" to stop Resistance bombings.

PHOTO CAPTION

Palestinian residents survey the damage after an Israeli incursion into Zeitoun, on the outskirts of Gaza City, Friday, May 24, 2002. Witnesses said Israeli troops entered the neighborhood and blew up three small factories. The incursion followed several incidents of mortar and rocket fire at Jewish settlements in Gaza. (AP Photo/Charles Dharapak)