A senior Hezbollah commander was killed in a car bombing in Syria that the Shiite militant group blamed on Israel on Wednesday, an accusation the Jewish state denied.
Hezbollah, which is backed by Syria and Iran, accused Israel of killing Imad Mughnieh, thought to be in his late 40s.
"After a life full of jihad, sacrifices and accomplishments ... Haj Imad Mughnieh ... died a martyr at the hands of the Israeli Zionists," said Hezbollah, which fought a 34-day war in 2006 with the Jewish state.
The statement did not say how he was killed, but the announcement came a few hours after a late night explosion in Damascus destroyed a vehicle, killing one man and injuring two others.
Israel officially denied any involvement in the assassination the Hezbollah commander, but news of Mughnieh's death was widely hailed by senior politicians.
"Israel rejects any attempt by terrorist organizations to attribute to it any implication in this affair," said a statement from Prime Minister Ehud Olmert's office.
The news media were quick to predict that Hezbollah would attempt to carry out revenge attacks against Israeli targets.
Dany Yatom, a former head of Israel's Mossad spy agency, said he did not know who had "liquidated Imad Mughnieh, but it was a success for the intelligence community. He was one of the biggest terrorists in the world, in the same league with Osama bin Laden."
Security experts say Mughnieh was at the top of Israel's list of most-wanted terrorists and also on America's most wanted list.
Mughnieh's brother was killed in a similar attack in Beirut in 1994. Reports at the time suggested Imad was the real target. A second attempt was said to have been planned during the brother's funeral, but Mughnieh did not attend. Mughnieh had spent much of the 1990s in Iran making only few visits to Beirut.
Some reports suggested he was in charge of Hezbollah's operations abroad.
Mughnieh, who has been in hiding for years, was among the fugitives indicted in the United States for the 1985 hijacking of a TWA airliner in which a U.S. navy diver was killed.
He was wanted for his suspected role in a number of attacks, including the 1992 bombing of the Israeli embassy in Buenos Aires, which killed 29 people, and the 1994 bombing of a Jewish community centre there that killed 85 and wounded 300.
He is also wanted for the hijacking of a TWA airplane in Lebanon in 1985 and the abduction of westerners in the country during the 1980s, when Islamic Jihad, a shadowy pro-Iranian group widely believed linked to Hezbollah, kidnapped several Western hostages, including Americans, in Beirut.
The group, at the time thought to be commanded by Mughnieh, killed a few of its captives and exchanged others for U.S. weapons to Iran in what was later known as the Iran-Contra scandal.
The group was also linked to suicide bomb attacks against the U.S. embassy in Beirut and Marine headquarters in Lebanon in 1983, which killed over 200 Americans.
The Hizbullah commander was also involved in numerous terror attacks on Israel's border with Lebanon, including the kidnapping of three Israeli soldiers.