Israeli tanks and assault helicopters have launched an attack on the hillside headquarters of the Palestinian security chief.
The Palestinians claim hundreds of people are trapped inside the headquarters of Colonel Jibril Rajoub, who is refusing to surrender himself.
Mr Rajoub, who is not inside the complex, says 20 people have been wounded, and that medical personnel are not being allowed to treat the injured.
Israeli officials believe those inside include many fugitives wanted in connection with attacks against Israel, but Mr Rajoub denies there are any wanted men in the compound in Beituniya, an industrial suburb of the West Bank town of Ramallah.
Jibril Rajoub is one of the most powerful figures in the West Bank, a longtime player in peace talks and truce negotiations.
An amusement park called Fun Land, with a Ferris wheel and carousel, is just adjacent to the security chief's compound. Five Israeli tanks took up positions just outside the attraction. "We're staying here," said an Israeli soldier manning one tank.
No sign of movement could be seen inside the compound, which consists of several large buildings including a prison.
Mr Rajoub called the situation inside "very, very, very bad," and told Israel Radio that he had ordered his men not to give up. "It's clear I can't give any other order," he said.
The attack on Mr Rajoub's headquarters came as Israel widened its military campaign in the West Bank, trapping Palestinian leader Yasser Arafat in his Ramallah headquarters and taking control of several towns, villages and refugee camps.
The Israeli offensive came on the heels of a wave of Palestinian suicide bombings in Israeli towns and cities.