The Israeli boy, 16-year-old Haviv Dadon, was killed Sunday as he walked home from a summer job in the border town of Shlomi. He was the first Israeli civilian to be killed by Hezbollah shelling since 1999. Five others were hurt, including a mother and her 9-month-old baby.
Israeli attack helicopters destroyed the cannon that launched the shells, the Israeli military said. Early Monday, an Israeli warplane broke the sound barrier over Beirut, setting off a sonic boom that woke residents, a frequent Israeli tactic when tension rises.
Lebanese President Emile Lahoud condemned "Israel's aerial terrorism…part of Israel's moves aiming to destabilize the region."
Earlier, U.N. Secretary-General Kofi Annan had urged Israel to exercise utmost restraint, but said the shelling "represents a serious violation" of the border and previous U.N. resolutions.
Israeli officials said Sharon would largely use diplomacy to try to halt cross-border rocketing by the Lebanese guerrilla group.
Israel blames Syria, the main power in Lebanon, for the weekend flareup, and signaled that it wants Washington to enforce a U.S. demand that Syria rein in Hezbollah, which also has Iranian backing.
The Egyptian, Saudi and Syrian foreign ministers hastily scheduled a meeting in Cairo Monday that Egyptian Foreign Minister Ahmed Maher said would focus on Israel and Iraq.
Haaretz newspaper reported that in a televised interview a Hezbollah commander said the group did not seek daily clashes with Israel but did hope to drive troops out of the contested Shaba Farm area. Israel retained a presence there even after its May 2000 pullout from Lebanon, angering Hezbollah.
Still, there is concern that escalating tension on the Israeli-Lebanese border might re-ignite Israeli-Palestinian fighting.
A 6-week-old cease-fire by Palestinian militants has brought a sharp reduction in the violence that raged for three years.
But progress on implementing the road map has been slow, and on Sunday, Israel slammed on the brakes, with Sharon and other officials saying the plan would not move ahead until the Palestinians dismantled militant groups.
The Palestinians said Israel was the one violating the blueprint.
Sharon made it clear during the Cabinet meeting that there can be "no progress toward a Palestinian state without full implementation of their obligations," said an Israeli official who briefed reporters on condition of anonymity.
Under the road map, the Palestinians are supposed to dismantle "terrorist capabilities and infrastructure (including) confiscation of illegal weapons."
The official said that at Sunday's Cabinet meeting, military chief of staff Lt. Gen. Moshe Yaalon said Palestinian security forces were doing little or nothing to stop attacks.
"The Palestinian Authority must dismantle the terrorist infrastructure — period," the official quoted Yaalon as saying.
Palestinian Prime Minister Mahmoud Abbas refuses to order a crackdown on militants, fearing a civil war, and wants to persuade the militants to end their attacks.
Palestinian legislator Saeb Erekat said it was Israel, rather than the Palestinians, which was failing to live up to its commitments under the road map, which is meant to lead to Palestinian statehood by 2005.
"In accordance with the road map, what should be dismantled is the Israeli occupation and the Israeli settlements," Erekat told The Associated Press.
As part of the plan, Israel commits to "immediately dismantle" about 100 unauthorized settlement outposts established in the West Bank since 2001, to take "all necessary steps to help normalize Palestinian life" and to withdraw "progressively" from Palestinian autonomous zones occupied since fighting between the two sides erupted in September 2000.
Israel has so far withdrawn from parts of the Gaza Strip and from the West Bank town of Bethlehem. About a dozen outposts have been taken down, but a similar number have gone back up. Some roadblocks have been removed, but dozens remain.
Israeli police said Monday they had arrested a Jewish settler for issuing a death threat against Sharon.
A 22-year-old man was arrested Sunday outside Sharon's Jerusalem residence after he told security officials, "The prime minister killed my friend and my neighbor. It's no problem at all for me to kill him," according to police spokeswoman Zvia Cohen. She said the man was a resident of the small Jewish enclave in the West Bank city of Hebron, but did not give his name.
It was not clear who the suspect was referring to when he blamed Sharon for two deaths, but presumably he was upset over killings of fellow settlers by Palestinian militants. Hardliners among the settlers have complained that Sharon is not tough enough against the Palestinians.
Hebron's Jewish enclave — where about 550 Jewish settlers live surrounded by more than 130,000 Palestinians — is a center of ultranationalist Jews.
Earlier this month, two Jewish settlers from the Hebron area were charged with possessing explosives stolen from the army, apparently in connection with an anti-Arab plot.
Security around Israel's prime minister was stepped up in May following threats from right-wing Jews to punish him for his support of the U.S.-sponsored "road map" peace plan.
In 1995, Israeli Prime Minister Yitzhak Rabin was assassinated by an Israeli Jew opposed to his efforts to promote Israeli-Palestinian reconciliation.