Palestinian President Mahmoud Abbas outlawed the armed militias belonging to the Hamas movement Sunday, moments after he swore in a new cabinet in Ramallah to replace the unity government led by Hamas leader Ismail Haniyeh, which was dissolved Thursday.

Abbas also outlawed Hamas the movement's Izz-al-Din al-Qassam Brigades and executive force, but a clarification in the form of a presidential decree sent to reporters made no mention of Hamas' political wing.

Abbas' move comes after Hamas militants took over all security installations in the Gaza Strip affiliated with the presidency or with the president's Fatah movement in five days of savage fighting last week, which left around 100 people dead.

Abbas, urged by his advisors to act, withdrew Fatah from the Hamas-led unity cabinet and then dissolved the government and said he would form a new one in its place.

Hamas said the new administration, headed by former finance minister Salam Fayyad, is illegal. But the 12-minister new cabinet appears to have the backing of many Arab states, as well as of the US and European Union.

The swearing-in of the new government on Sunday effectively divides the Palestinian territories into two political entities - one, based in the Gaza Strip, headed by Hamas and the other West Bank-based one headed by Fayyad.

Israeli Prime Minister Ehud Olmert, currently visiting Washington, said on Saturday he sees the new Fayyad-led government as a partner for peace talks.

In the meantime, Israel plans to further isolate the Gaza Strip following the successful Hamas blitz last week, Israel Radio reported Sunday.

Meanwhile a Hamas official said that kidnapped BBC journalist Alan Johnston, who has been held by Gaza militants since March, would be freed soon, but others played down hopes of an imminent release.

Quoting high-ranking Israeli security sources, the report said Israel would try to break the unity of Hamas by preventing the smuggling of weapons, ammunition and money into the Strip and would continue to reject talks with Hamas, which refuses to recognise Israel's right to exist.

The London Sunday Times, meanwhile, claimed Sunday that newly appointed Israeli Defence Minister Ehud Barak plans to launch a military assault against Hamas in the Strip.

The report, quoting "unnamed senior Israeli military sources," said some 20,000 soldiers would be involved in the operation, which would be launched if Hamas allows makeshift missiles to continue to be fired at Israel, or renews suicide attacks.

Barak has yet to take over the defence ministry. He was named minister over the weekend, after winning the leadership of the Israel Labour Party and will seek Knesset approval for the post on Monday.