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GAZA | Fri Feb 29, 2008 8:14am EST

GAZA (Reuters) - Hamas leader Ismail Haniyeh brushed aside Israeli assassination threats on Friday and said in his first public appearance in over a month that the Islamist group was ready for any large-scale attack.

Tens of thousands of Gazans poured into the streets of the Hamas-controlled Gaza Strip after prayers in what leaders called a show of solidarity.

Israel has threatened to launch a large-scale military operation to try to stop the barrage of cross-border rockets fired by militants in Gaza. The rockets killed one Israeli on Wednesday and reached as far as the southern city of Ashkelon.

With Prime Minister Ehud Olmert under pressure to stop the rockets, Israel stepped up its air campaign, killing at least 33 Gazans, including five children, in the past two days alone.

"I tell the leaders of the (Israeli) occupation: This round will end in terrible failure just like all the other rounds failed," Haniyeh said at a mosque near his home in Gaza's Beach refugee camp.

Senior Hamas leader Fathi Hammad told a large rally in northern Gaza that the group's rocket were improving and would one day "reach everywhere" in Israel.

Senior members of Olmert's government have called for targeting Hamas political leaders and for bringing down Haniyeh's government.

Shunned by the West for refusing to renounce violence after beating Palestinian President Mahmoud Abbas's secular Fatah faction in a parliamentary election two years ago, Haniyeh said Israel was "deluded" if it thought it could now remove Hamas.

"What does a large scale raid mean? You (Israelis) were in the Gaza Strip and you quit because of the resistance. What does assassination mean? If some leaders are assassinated, would the cause be assassinated?" Haniyeh asked.

Israel withdrew troops and settlers from Gaza in 2005 but continues to control the air space, coastal waters and major border crossings.

Hamas seized the Gaza Strip by force in June after routing Abbas's more secular Fatah faction. After the takeover, Abbas dismissed Haniyeh's government and set up his own administration in the occupied West Bank.

Faced with a crippling Israeli-led blockade, Haniyeh appealed for patience and unity from Gaza's 1.5 million residents. "We are required to be united in facing the enemy."

Although Abbas and his secular Fatah faction remain deeply hostile to Hamas, the president and his government have publicly criticized Israel for its military actions and for threatening to kill Hamas political leaders.

(Editing by Samia Nakhoul)

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