Israel said it would continue its contacts on the matter with Egypt, through whom Hamas handed the names of the prisoners to Israel.
 
False hopes
 
It said that while there had been "some progress in negotiations, they are far from being completed".
 
"The various reports that have appeared in this context must be treated with due caution in order not to create false hopes," it added.
 
Israeli political sources said plans to convene a special ministerial committee to look into whether to loosen criteria for releasing prisoners in an exchange deal had been postponed.
 
Ghazi Hamad, an aide to Ismail Haniya, the Palestinian prime minister and a Hamas leader, said: "If Israel continues to insist on its own criteria, it will be responsible for the failure to reach a deal."
 
Barghouthi on list
 
Wasfi Kabha, a Hamas cabinet minister, told Reuters on Monday that there were about 1,400 names on the list, including Marwan Barghouthi, a Fatah leader serving five consecutive life terms and widely seen as a possible successor to Mahmoud Abbas, the president.
 
Your Views

"A peace deal is certainly possible, but only in a situation where both sides actually want it"

Gary, London, UK

Send us your views

Also on the list is Ahmed Saadat, leader of the Popular Front for the Liberation of Palestine, suspected of ordering and planning the 2001 assassination of an Israeli cabinet minister, but held for other unspecified offences.
 
Freeing fighters and especially the leaders from Israeli jails is a highly emotive issue for Palestinians, as well as for Israelis who have lost relatives in attacks.
 
Meir Indor, the director of the Israeli Terror Victims' Association Al-Magor, said: "We know for sure that a prime minister who will sign to release terrorists right now will bring chaos immediately."
 
But an exchange deal after months of deadlock could spur progress in talks between Olmert and Abbas on Sunday.
 
An Abbas aide said the Palestinian president would discuss "the Arab peace initiative and prospects for reviving the peace process".
 
But Olmert has said that Abbas's power-sharing partnership with Hamas and the continued captivity of Shalit meant that no real progress towards Palestinian statehood could be made in their meetings.
 
The leaders agreed to hold fortnightly meetings at the urging of the US.
 
Shalit was seized and two colleagues killed in June by fighters from Hamas and two other armed groups who tunnelled into Israel from Gaza.
 
In violence on Tuesday, an Israeli hitchhiker was seriously wounded by Palestinian attackers as he waited at a junction in the northern part of the West Bank, an Israeli military spokeswoman said.
 
There was no immediate claim of responsibility.