GAZA CITY, Gaza Strip - In their sharpest power dispute yet, Palestinian President Mahmoud Abbas on Friday blocked Hamas' plans to set up a shadow security force, which was to be made up of militants and to be headed by the No. 2 on Israel's wanted list.

Abbas issued a presidential decree vetoing the decisions made a day earlier by Interior Minister Said Siyam of Hamas. As president, Abbas wields considerable power and has the right to approve or reject key appointments.

Prime Minister Ismail Haniyeh of Hamas was to meet with his interior minister later Friday to weigh a response.

Siyam's decision Thursday to set up the new force and appoint Jamal Abu Samhadana as its commander was seen as a major provocation to Abbas, to Israel and to the international community...