An explosion rocked Gaza City Thursday afternoon, as Fatah security forces positioned at a security post redeployed elsewhere, and blew it up as they left rather than let Hamas take it over.
Hamas fighters later captured the second of four major Fatah command centers in Gaza City, planting the Islamic group's green flag on the roof of the intelligence services building and growing nearer to a complete conquest of the Gaza Strip.
Hamas also seized control of the southern city of Rafah, the second of Gaza's four main towns to fall into the Islamic militants' hands, according to witnesses and security officials.
A Hamas military victory in Gaza would split Palestinian territory into two, with the Islamic extremists controlling the coastal strip and Western-backed Fatah ruling the West Bank.
In other developments:
Israel was watching the carnage closely, concerned the clashes might spawn attacks on its southern border.
The White House described the situation in Gaza as "a source of profound concern," reports CBS News correspondent Peter Maer. "It is certainly not a situation we like," said White House spokesman Tony Snow.
"Hamas will soon be in full control of Gaza, and that creates a new strategic equation in the Middle East," says CBS News correspondent Robert Berger.
"Hamas is part of a radical Islamist alliance led by Iran and including Hezbollah in Lebanon," said Berger. "Hamas is sworn to Israel's destruction and the army says that once the group consolidates power in Gaza, it's just a matter of time before it launches attacks against Israel. And the prospect of a nuclear Iran make the strategic equation even more dangerous."
The moderate President Mahmoud Abbas of Fatah, for the first time in five days of fierce fighting, ordered his elite presidential guard to strike back. But his forces in Gaza were crumbling fast under the onslaught by the better-armed and better-disciplined Islamic fighters.
Fatah said seven of its fighters were shot to death outside the Preventive Security building in Gaza. A doctor at Shifa Hospital, who spoke on condition of anonymity for fear of reprisal, said he examined two bodies that had been shot in the head at close range.
A witness, Jihad Abu Ayad, said men were killed in front of their wives and children.
"They are executing them one by one," Abu Ayad said. "They are carrying one of them on their shoulders, putting him on a sand dune, turning him around and shooting."
The Palestine Liberation Organization's top body recommended that Abbas declare a state of emergency and dismantle Fatah's governing coalition with Hamas. Abbas said he would review the recommendations and make decision within hours, said an aide, Nabil Amr.
Some of the Hamas fighters kneeled down outside the captured Preventive Security complex, touching their foreheads to the ground in prayer. Others led Fatah gunmen out of the building, some shirtless or in their underwear, holding their arms in the air. Several of the Fatah men flinched as the crack of gunfire split the air.
"We are telling our people that the past era has ended and will not return," Islam Shahawan, a spokesman for Hamas' militia, told Hamas radio. "The era of justice and Islamic rule have arrived."
Sami Abu Zuhri, a Hamas spokesman, heralded what he called "Gaza's second liberation," after Israel's 2005 evacuation of the coastal strip.
Militants and civilians were looting the compound, hauling out computers, documents, office equipment, furniture and TVs.