10468. THE ISRAELI-ARAB CONFLICT: RENEWED PROSPECTS FOR A HOLY WAR. Assesses the move towards Islamic fundamentalism among Arab citizens of Israel and the Palestinian Arabs in the occupied territories. Following a review of the Islamic fundamentalist position within the context of the Israeli-Arab conflict, the paper traces the rise of fundamentalist groups-- particularly Hamas --in the occupied territories. Looking at the Arab minority population within Israel, the analysis considers factors in Jewish-Islamic relations which have helped to encourage the development of fundamentalist sympathies. The paper concludes with assessment of rising Islamic fundamentalism in light of the current peace process. 15p., 37f., 34b.