RAMALLAH, West Bank ? The Palestinian prime minister resigned Saturday in a sweeping leadership shakeup that also saw two senior officials replaced in Yasser Arafat’s overhaul of his security forces, a key U.S. and Israeli demand for restarting the deadlocked peace process.

The changes followed a series of kidnappings in the Gaza Strip that signaled a breakdown of authority.

“There is a crisis. There is a state of chaos in the security situation,” Ahmed Qureia said after announcing his resignation as premier during a Cabinet meeting in the West Bank town of Ramallah.

Queria told Palestinian officials he had resigned “because of a series of internal and external issues that developed in the recent period,” according to a statement from his office. He specifically cited the deteriorating security situation in Gaza.

Qureia sent his resignation letter to Arafat through an aide before the Cabinet meeting. The 74-year-old Palestinian leader, however, refused to accept it and scrawled a giant “X” over the paper with a pen, a Palestinian official said.

Nevertheless, Qureia said he would not withdraw the resignation, according to Minister of Local Government Jamal Shobaki.

The Cabinet planned to reconvene Monday to continue deliberations. It was unclear what would happen if the stalemate continued.

Qureia, who had held the job for 10 months, was unable to carry out deep reforms and root out corruption, with Arafat still holding the presidency and dominant power in the Palestinian territories.

He also had been frustrated by lack of progress on restarting the peace process with Israel, say officials close to him. No Israeli-Palestinian summit was held during Qureia’s time as prime minister.

Officials said the Cabinet meeting grew stormy at times. The interior minister, who is in charge of police and apparently was not consulted about the changes in the security infrastructure, walked out midway.

Israel had no comment on the swiftly unfolding events in the Palestinian territories. But Israel Army Radio quoted officials as saying the instability demonstrated again that Israel had no viable negotiating partner and must move forward with Prime Minister Ariel Sharon’s plan to unilaterally withdraw the army and settlers from Gaza next year.

The chaotic events also were likely to encourage opponents of Sharon’s plan who claim Israel cannot leave a security vacuum in Gaza and must stay.

Although failing to agree on the prime minister’s future, Arafat and Qureia met earlier Saturday and approved a series of steps to bring more than a dozen disparate security services under a more unified command.