Israeli security sources say Israel and the Palestinian Authority are trying to work out a deal that would end the army's offensive in the Gaza Strip in return for stopping militant rocket attacks on Israel.
Security officials say the talks began late Monday through an intermediary, who was not identified.
More than 60 Palestinians and at least five Israelis have been killed since Israel pushed into Gaza last week, after rockets fired by Palestinian militants killed two Israeli children.
Meanwhile, at the United Nations Arab diplomats submitted a draft resolution to the Security Council condemning Israel's offensive.
U.S. Secretary of State Colin Powell said Monday he hopes Israel's military offensive will be "proportionate" to the threat the country is facing and will end soon.