Palestinian Prime Minister Ismail Haniyeh on Saturday rejected demands that his Hamas-led government resign and called for the resumption of talks to form a national unity government with the Fatah Party.
Tensions between the two parties have grown in recent days, with Palestinian Authority President Mahmoud Abbas of Fatah saying that coalition talks - aimed at ending a crippling foreign aid boycott against the Hamas-led government - had reached a dead end.
On Friday, the PLO's Executive Committee, which is dominated by Fatah, called on Haniyeh to step down to make way for a new premier who could resume talks with Abbas.
Speaking at a news conference during a trip to Qatar, Haniyeh said that demand was "only creating chaos in the street."
Hamas spokesman Fawzi Barhoum said the call for Haniyeh's resignation amounted to a coup.
The militant Islamic group won an overwhelming majority in parliamentary elections in January, while Abbas was elected separately last year, setting up government paralysis and leading to tensions in the street.
Hamas denied coalition talks had collapsed, and said Abbas was simply trying to pressure them into making concessions.
"Anyone who is saying that the dialogue among the Palestinian factions is over should take full responsibility for the consequences," Haniyeh said.
On Saturday, Abbas met with top European diplomats in Gaza to brief them on the domestic disagreements.
European Union foreign policy chief Javier Solana said the collapse of the talks killed hopes of ending the international economic sanctions on the Palestinian government, adding that Hamas missed its opportunity.
"Very sadly, I have to say the chance has been lost," he said after meeting with Abbas.
Abbas' choices for breaking the impasse with Hamas are limited. He has the authority to fire the government, but would not win confirmation for a replacement Cabinet from the Hamas-dominated Parliament.
Palestinian law does not allow the president to call early elections, though there could be a referendum on whether such elections should be held, Abbas aides said.
A member of a panel Abbas appointed to guide him in the impasse said its members were leaning toward recommending early elections, both for president and parliament.