The funeral for Hamed Rantissi, one of two Palestinian fighters killed in a weekend assault on an army post inside Israel in which two soldiers were killed, four wounded and another kidnapped, was unusually deserted.

Not far away, Israel has been amassing tanks, soldiers and artillery on the other side of the Kerem Shalom crossing between the Gaza Strip and the Jewish state and vowing a sweeping military operation to recover a kidnapped soldier.

The Popular Resistance Committees, along with Hamas' armed wing the Ezzedine al-Qassam Brigades, and the previously unknown Army of Islam claimed responsibility for Sunday's sunrise attack.

It was the PRC's most daring assault against the Israeli army since another unit blew up a pair of tanks in Gaza in 2002. But with prospects of a pounding Israeli response looming, militant celebrations have been largely muted.

At Rantissi's funeral, leaders and many fellow militants in the PRC stayed away ? Sunday's raid a response to the deaths of 22 civilians in an alleged Israeli shelling and a series of botched air strikes over the Gaza Strip.

Israel regularly takes out wanted militants in air strikes and those most active in plotting anti-Israeli attacks live in constant fear of assassination. Such fears have grown more acute in recent days, say many in Rafah.

"We used to see the Committees' leaders in the streets everywhere," says Mohammed Ali (31) an English high school teacher.

"Now they have disappeared and we keep hearing about a big Israeli military operation in southern Gaza."

"The situation is dangerous," says Naim Zanoun, a mid-level PRC activist at Rantissi's downbeat funeral.

Ten days earlier hundreds turned out to bury one of Rantissi's comrades who died in the same Israeli air strike which killed PRC leader and founder Jamal Abu Samhadana.

Back then, they marched through the streets, firing Kalashnikovs and hailing their fallen fighter.

On Monday, by contrast, family members and a handful of friends drank tea lazily in the shade near the rusted iron wall along Gaza's border with Egypt. There were more newly printed portraits of the fallen militant, than mourners.

"No one will show themselves in the street now. If they even show a single eye, the Israelis will take them out," Zanoun added.

Hamas leaders are suddenly difficult to reach. Many have shut off their mobile phones which are frequently used by Israeli intelligence to locate wanted militants.

Even before Hamas' armed wing claimed the latest raid, Israel had put the movement on notice that its leaders were fair game.

An official in Palestinian president Mahmud Abbas' office also charged that negotiations with the ruling Islamists to end an acute domestic crisis are likely to ground to a halt because some Hamas leaders have gone underground.

"Some (Hamas officials) will stop their contacts for fear of Israeli threats," Tayeb Abdelrahim told AFP.

In Quba, just outside the southern town of Rafah, the houses are boarded up and virtually no one is to be seen where fears of an imminent Israeli offensive have left the village reminiscent of a ghost town.

"All of them fled because they are afraid of an attack from the Israelis," says Abel Jawad Juda, the last remaining straggler.

Juda, an engineer who builds schools for the education ministry, is the only person remaining on the dry, sparsely populated farmland around Quba that lies within earshot of Israel.

The dozen or so other Palestinian families who live here have all packed up and left, he says. The exodus has come with Israel building up troops just across the Kerem Shalom crossing.

Just beyond his olive orchard, an Israeli observation tower at Kerem Shalom peers out across southern Gaza.

It is so close that when Juda has visitors who the Israeli watchmen do not recognise they holler warnings, he says.

Juda, wearing a snazzy suit, carefully knotted necktie and a white wool skullcap, knows an Israeli incursion is likely, but he is holding his ground.

"I am not afraid. God will choose when I die," he says. "This killing, this fighting is an everyday thing for us, it becomes normal in our lives."