HEBRON, West Bank- Israeli troops seized all of this divided city Saturday in response to an ambush on Jewish worshippers in which Palestinian gunmen lured security forces into a narrow alley and raked them with massive fire. Twelve Israelis were killed and 14 wounded.

In the attack Friday evening, Palestinian gunmen fired on Jewish settlers walking home from prayers. As security forces battled back, many became trapped in a side street. Soldiers and members of the paramilitary border police accounted for nine of the dead.

The killings marked one of the highest death tolls suffered by Israeli forces in a single encounter since the Mideast violence erupted more than two years ago.

Col. Dror Weinberg, the army commander for the Hebron area, was among those killed, and the violence raised the prospect that Prime Minister Ariel Sharon's government will take strong retaliatory action.

The commander of West Bank forces, Maj. Gen. Moshe Kaplinski, said Saturday that "the army intends to return to its previous deployment in the city, that is, to be in all parts of the city."

Troops had withdrawn from the Palestinian sector of Hebron last month, but returned in force Saturday, with soldiers patrolling the mostly deserted streets.

Friday's bloodshed began as Jewish worshippers were walking home from Sabbath prayers in the ancient Tomb of the Patriarchs in central Hebron, to the nearby settlement of Kiryat Arba, about a half-mile away, just to the east of the town.

Gunmen from the Islamic Jihad group opened fire with rifles and grenades, and the security forces returned fire, and were soon joined by reinforcements, including soldiers from a nearby army post.

Soldiers pursued the gunmen onto a narrow side street, where the troops came under withering fire, apparently part of a well-planned ambush, according to one army officer in Hebron who declined to give his name. The gunbattle then raged until the troops killed three Palestinian attackers, though more were believed to have been involved, and presumably escaped, the officer said.

"There was gunfire from left and right, from every possible angle, they were shooting at us from above," one man, who gave his name only as Arik, told Army Radio.

Because the Palestinian gunmen were firing from such a densely populated area, it was difficult for soldiers to locate the source of the shooting, said Kaplinski. During the battle and afterward, flares lit up the night sky and military helicopters helped evacuate the wounded.

Four Israeli soldiers, five border policemen and three Israeli civilians were killed. The dead civilians were from Kiryat Arba and included at least one member of a local volunteer security group.

Fourteen Israelis were wounded.

After the shooting stopped, Israeli forces tore down three Palestinian homes used by the gunmen.

The Israeli government did not say how it would respond. However, Sharon's government has warned repeatedly it will hit back hard following attacks. In the past, the army has moved into Palestinian cities, tracked down members of the Palestinian group responsible, and besieged the compound of Palestinian leader Yasser Arafat.

After recent attacks, hardliners in Sharon's government have called for sending Arafat into exile, but so far the government has refrained from taking such action. The Israeli security services and the United States government have both warned against it.

The Israeli Foreign Ministry said the Palestinians had carried out a "Sabbath massacre."

Asked about the attack, Arafat aide Nabil Abu Rdeneh said, "the only solution to ending the cycle of violence is to come back to the negotiating table without conditions."

Islamic Jihad said the shooting was revenge for the recent killing of its northern West Bank commander, Iyad Sawalha. Israel said Sawalha orchestrated two deadly bus attacks, including an Oct. 21 bombing that killed 14 people in northern Israel.

As news of the shooting reached Palestinian areas, dozens of Islamic Jihad supporters in the Shati refugee camp in the Gaza Strip rushed into the streets Friday night to celebrate, with some firing in the air. "This is retaliation for the daily crimes and ugly massacres committed by the Zionist occupation against our people," one armed man said over loudspeaker.

Hebron, to the south of Jerusalem, has long been a volatile place filled with religious and political tensions. Hebron is home to about 130,000 Palestinians, and about 450 Jewish settlers, who are protected by the security forces. Muslims here are among the most devout and the Jewish settlers among the most radical, and there are daily provocations.

Hebron's so-called "worshippers' lane" where the attack took place links the Jewish settlement of Kiryat Arba and downtown Hebron, and has been targeted by Palestinian gunmen in the past. Several thousand settlers live in heavily protected Kiryat Arba, just to the east of Hebron.

Hebron has had a history of deadly Jewish-Arab violence.

Jews had lived there for centuries alongside Arabs until a spasm of rage swept the city in 1929. Arabs rioted, killed dozens of Jews with guns and axes and drove the others out, destroying the city's ancient Jewish quarter.

After Israel captured the West Bank in the 1967 Mideast war, Jews began moving back into Hebron, and today some 450 Israeli settlers - many of them considered extremist - live in several enclaves in the town.

One of the flashpoints is the Tomb where Jewish settler Baruch Goldstein shot dead 29 Muslim worshippers in February 1994 before being beaten to death. The massacre sparked riots that lasted for days and helped spawn the phenomenon of suicide bombings against Israelis.

In violence Saturday, two Palestinians were killed in the northern West Bank.

In Jenin, 17-year-old gunman Ibrahim Saade was killed in an exchange of fire with Israeli troops in the town's refugee camp, according to Palestinian security officials. Saade, whose brother was killed in similar circumstances three months ago, is the son of the Islamic Jihad leader in Jenin, Sheik Bassam Saade, who is himself wanted by Israel.

In Nablus, a 20-year-old woman, Samar Sharab, was hit by Israeli army fire while looking out the window of her home, according to her father, Mahmoud Sharab. The Israeli military said it was checking the report.

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