Two of the wounded were electricians doing repair work.

Military officials said troops did not fire into the coffee shop. An Associated Press reporter counted eight bullet holes in the windows of the coffee shop and 11 more inside, and saw glass shards on the floor.

The raid came hours before Israel announced it was sealing off the West Bank and Gaza Strip - keeping about 3 million Palestinians from entering Israel and preventing Palestinian residents of the West Bank from leaving their communities. The closure was part of an effort to prevent militant attacks on Israelis over the Yom Kippur holiday beginning Sunday evening.

About 3,000 Palestinians marched earlier Friday in a Gaza refugee camp in support of Hamas, the Islamic militant group that has staged suicide attacks against Israelis. Young men in black masks carried cardboard models of rockets and wore mock suicide bomb belts made of wood. Some Palestinians burned Israeli and American flags.

A senior Palestinian official, meanwhile, said Yasser Arafat has agreed to relinquish some control over security forces and boost the authority of incoming Palestinian Prime Minister Ahmed Qureia's government. That would be in line with Israeli and U.S. demands that the Palestinians unite all security forces under one command.

Currently, Arafat directly controls four branches of the security forces, with the remaining four under the interior minister. Under the new arrangement, Qureia's designated interior minister, Gen. Nasser Yousef, would control all the branches, but would receive orders from the 13-member National Security Council, which Arafat heads.

Israeli fence map would include Jewish settlement

Israeli security officials said they were debating how to deal with Qureia's incoming government. Some officials proposed giving him a boost by releasing Palestinian prisoners and removing a large number of army roadblocks. They also were looking into holding cease-fire talks.

Such moves have the support of Chief of Staff Lt. Gen. Moshe Yaalon, the officials said, but substantial discussions on any such moves have yet to begin and would have to be approved by Prime Minister Ariel Sharon.

Israel's position has been to keep up strikes against Palestinian militants and not negotiate a truce unless Palestinian security forces begin disarming and arresting militants. The overtures being discussed would depend on Qureia's actions against militants, the officials said. Qureia has said he would not risk a civil war by launching a major crack down on militants.

A top Palestinian official said Israeli officials sent messages expressing a willingness to try to negotiate a cease-fire.

The Friday raid on the coffee shop in the northern West Bank town of Qabatiyeh began when about a dozen jeeps suddenly pulled up outside and soldiers jumped out, said Nasser Zakarneh, 30, who owns a shop next door.

Soldiers opened fire at the coffee shop filled with card players, he said.

Two electricians working inside ran out when they heard the shooting and were about 40 yards from the buildings when they were shot, Zakarneh said. A third man was shot about 20 yards away, he said.

The electricians, one of whom was in serious condition, were taken to Israeli hospitals, Palestinian security officials said. The third man was treated at a local clinic. About 20 people were detained for questioning and released Friday evening, Palestinian sources said.

The Israeli military said soldiers fired at several fleeing men after calling on them to halt and then shooting in the air. The officials said they did not immediately know whether any of the three wounded were fugitives. The army put the number of patrons detained at about 30.

In another development, Richard LeBaron, the deputy chief of mission at the U.S. Embassy in Tel Aviv, met Thursday with Amos Yaron, the director of Israel's Defense Ministry, to discuss the route of a security barrier Israel is building around the West Bank. An embassy spokesman, Paul Patin, declined comment on the details of the meeting.

Earlier this week, Israel's Cabinet approved a plan to build a series of protective fences deep in the West Bank.

The United States has said the barrier's route could be interpreted as an effort to define unilaterally the border of a future Palestinian state. In Thursday's meeting, Yaron assured U.S. officials the new fences will not be linked to the main barrier, which is closer to the border of the West Bank, Israeli media reported.

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