The Palestinian President, Mr Yasser Arafat, threatened to walk out of the Middle East summit in anger over US bridging proposals but President Clinton calmed him down, a source close to the talks said last night.
As an official news blackout continued for a fourth day, Israeli and Palestinian sources both said the United States had put forward its own ideas for the first time on Thursday night aimed at narrowing differences on the core issues.
But those ideas, which the Israeli source said were only presented verbally, sparked the summit's first reported crisis.
One source said that Mr Arafat was so angry at the proposals made by the US Middle East envoy, Mr Dennis Ross, that he ordered his delegation to pack their bags.
"There was a crisis during the talks yesterday and Arafat ordered his delegation to pack their bags to leave Camp David in anger at American proposals which were identical to the Israeli position," the source said.
"President Clinton calmed Arafat down and the Palestinian leader agreed to stay only after the Americans withdrew their proposals. They are expected to submit new proposals," the source added.
The White House spokesman, Mr Joe Lockhart, refused to confirm or deny the report, but conceded that tensions had flared at times.
A Palestinian source said the US ideas covered Palestinian refugees, the fate of Jerusalem and borders of a future Palestinian state.
He also said Mr Arafat had rejected a redrawn map of the disputed city of Jerusalem proposed by the Israeli Prime Minister, Mr Ehud Barak's delegation, saying it was close to an Israeli proposal to grant Palestinians in East Jerusalem municipal powers under Israeli sovereignty.
Two senior cabinet ministers told reporters in Israel this week that a swap of West Bank land for sovereign Israeli territory would also be on the table.
Mr Lockhart said Mr Clinton was expected to remain at Camp David until he leaves for a Group of Eight summit in Japan next Wednesday. Asked if the atmosphere was positive, Mr Lockhart said he would prefer to stick to the word "informal". The talks had split into working groups on each of the core issues, he said.