JERUSALEM — Israel is on the brink of a policy U-turn that would authorize 1,500 armed Palestinian Arab soldiers based in Jordan to move into the West Bank and Gaza Strip.

While Israel sees the move as a way to counterbalance the growing power of Hamas, such a policy shift could worsen the internecine violence between rival Palestinian Arab factions, which has claimed scores of lives this year.

It reverses years of strict military sanctions imposed by Israel on the territories because of fears that weapons provided to Palestinian Arabs would end up being used for attacks on Israeli targets.

America, which is behind the initiative, hopes that the arrival of the troops, trained and equipped to relatively high standards by the Jordanian armed forces, will restore badly needed order to the region.

No official announcement has been made, although President Bush is understood to have formally requested the troop transfer before the 45-minute private meeting he held with Prime Minister Olmert of Israel this week.

Raised in the early 1970s from among the millions of Palestinian Arab refugees living in Jordan, the Badr Brigade has never been allowed into the West Bank and Gaza because Israel has regarded it as an enemy force.

But the rise to power of Hamas has led to a rethink because the Badr Brigade is loyal to the faction of the moderate Palestinian Arab leader Mahmoud Abbas, Fatah, that Israel now supports.

Mr. Olmert speaking privately on Sunday, a day before he met Mr. Bush, indicated that he would respond favorably to America’s request.

The reason behind Israel’s U-turn was spelled out by the head of Israel’s domestic spy service, Yuval Diskin, in testimony to an Israeli parliamentary committee yesterday. Mr. Diskin said unless moderates from Fatah became more powerful, Israel would have to stage wide-scale incursions to neutralize the growing strength of Hamas and its militant supporters.

“Israel must prepare for a wide military confrontation in the Gaza Strip, if moderate sources in the Palestinian Authority do not get stronger,” he said. “Israel has no good options in Gaza. There only bad options and we need to choose the least bad of all.”

Mr. Diskin claimed to have evidence of a massive build-up of Palestinian Arab weapons. He said 30 tons of arms, ammunition, and explosives had been stockpiled in Gaza.

Hopes of an end to the financial crisis paralyzing the occupied territories were dashed yesterday when Hamas said the Palestinian Arab national unity government being drawn up would never recognize the right of Israel to exist.

After talks in Tehran with supporters within the Iranian regime, the Hamas foreign minister, Mahmoud Zahar, said the unity government’s planned manifesto ruled out the recognition of Israel. “Nonrecognition will continue,” he said.

Failure to recognize Israel means that a national unity government stands no chance of convincing the international community to restore much-needed financial aid.