Israel may further restrict the number of Palestinian workers allowed into the Jewish state, after a woman suicide bomber blew herself up at a Gaza crossing point, killing four Israelis.

The attack at the Erez crossing in northern Gaza could affect thousands of Palestinians who have to cross into Israel to earn their living.

Israeli officials say the issue of work permits is under review, after a 22-year-old Palestinian mother of two blew herself up.

Israeli government spokesman Avi Pazner, says the attack has dealt a blow, not just to Israelis but to ordinary Palestinians as well.

"As a gesture of goodwill, Israel allows Palestinian workers to come into Israel and the Palestinian terrorist organizations took this opportunity to kill as many people as possible," he said.

The explosion ripped through a recently opened facility where thousands of laborers and foreigners cross over between Gaza and Israel.

Speaking to reporters at the site, the commander of the Israeli Army in the Gaza Strip, Brigadier-General Gadi Shamni, warned the attack could have consequences for Palestinian workers.

"We are doing our best in order to facilitate the Palestinians' life in the Gaza Strip, to enable them to work in Israel, in the industrial areas surrounding the Gaza Strip," said General Shamni. "And an incident like this will not help us to be more co-operative with the Palestinians."

Both Hamas, a U.S.-government-listed terrorist group, and an armed wing of Palestinian President Yasser Arafat's Fatah faction, claimed joint responsibility for the bombing.

It was the first time that Hamas has dispatched a woman to carry out a suicide bombing.

The spiritual leader and founder of Hamas, Sheik Ahmed Yassin, warned that there would more attacks until Israel withdraw from what he called the Palestinian homeland.

The Palestinian prime minister, Ahmed Qureia, who has been attempting to persuade Hamas and other armed groups to agree to a cease-fire, refused to condemn the bombing.

He said Israeli military operations and restrictions on the Palestinians are leading to what he called an escalation of violence on both sides.