I had hopes and even dreams when the Gaza handover happened. This is more along the lines of a nightmare.Israelis woke up today with a new reality on their doorstep - the Islamic movement of Hamas triumphant in Gaza.
"New Lords of Gaza" proclaimed one Israeli newspaper. "Hamas Conquers Gaza," said another.
But for now, the Israeli government seems to be taking a low-key - although deeply concerned - approach to the monumental events in the Palestinian territories.
The Israeli Prime Minister Ehud Olmert is due to meet US President George Bush over the weekend and the new Hamas reality will be top of the agenda.
Following the events in Gaza, Mr Olmert said: "I call on my friend Abu Mazen (Palestinian President Mahmoud Abbas) to take the opportunity, now that almost the entire world understands the viciousness, the brutality of Hamas, to exercise his authority as the leader of the Palestinian people."
We don't want to be involved in Palestinian internal affairs
Mark Regev, Israeli Foreign Ministry
The spokesman for the Israeli Foreign Ministry, Mark Regev, said that Israel and the international community would need time "to digest the new reality".
"We're following it very closely, obviously it has consequences," he said. "But we don't want to be involved in Palestinian internal affairs."
For many Israelis there is deepening concern that it is Hamas, which does not recognise Israel, and not Fatah, which does recognise the Jewish state, that seems to have the decisive hand at this time.
Tax handover?
One newspaper editorial said: "The internal Palestinian clashes that Israel so wanted for so many years, is finally happening, but oy, it's happening the wrong way around."
There are suggestions from Israeli officials that their government will work with President Abbas and a Fatah government in the West Bank.
The Israeli government also might hand over hundreds of millions of dollars in tax revenues to Fatah which it collects on behalf of the Palestinian Authority. The revenues have been withheld by Israel since Hamas took power in March last year.
Domestically, the Hamas takeover will probably strengthen the right-wing Israeli parties. Israel withdrew from all its Jewish settlements in Gaza in the summer of 2005 and certainly did not expect a completely dominant Hamas in the territory.
Hamas gunmen in Gaza (14 June 2007)
Israelis may now have to do deals with both Hamas and Fatah
Benjamin Netanyahu, the leader of the main opposition party, Likud, has been warning for months that a Hamas takeover of the territory was a strong possibility - and he has been proved right.
Right-wing nationalist Avigdor Lieberman wrote in an article published in an Israeli newspaper that Gaza should be completely cut off from the outside world.
Mr Lieberman also advocated that water and electricity supplies to the territory should be cut off.
'Two separate entities'
"By turning the Gaza Strip into Hamastan, our enemies have defined themselves in black but clear lines, which make it possible and even obligatory to take action against them," he wrote in the Israeli daily newspaper Yedioth Ahronoth.
But some Israeli political analysts suggest that there could be a window of opportunity when the situation stabilises in Gaza and the West Bank.
Yossi Alpher, a political analyst, says that while the prospects of a peace process between the Israelis and Palestinians are now lower than they were before the Hamas takeover of Gaza, Israel might cut deals with the two sides.
"We are looking at two separate entities, Hamas and Fatah, and two different leaders," he said.
"There could be an opening to agree a ceasefire with Hamas in Gaza. In the West Bank, Israel might seek to give President Abbas more authority."
Israel faces stark Gaza reality
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#1 Israel faces stark Gaza reality
BBC
"it takes two sides to end a war but only one to start one. And those who do not have swords may still die upon them." Tolken