GAZA CITY, Gaza Strip - Gaza's Hamas rulers hinted Monday they would raise the stakes for a captured Israeli soldier, emboldened by Israel's decision to trade a Lebanese prisoner convicted in a brutal attack for the bodies of two other Israeli servicemen.

Hamas-affiliated militants captured Sgt. Gilad Schalit two years ago in a cross-border raid. Three weeks later, Hezbollah guerrillas in Lebanon burst across Israel's northern border and seized Ehud Goldwasser and Eldad Regev, touching off a monthlong war between Israel and the militant group.

After nearly two years of German-brokered negotiations, Israel's Cabinet overwhelmingly agreed Sunday to trade Goldwasser and Regev's bodies for Samir Kantar. The Lebanese militant was convicted to 542 years in prison for his role in a 1979 infiltration attack that Israelis perceive as one of the cruelest in their nation's history.

Gaza strongman Mahmoud Zahar, speaking to the independent Al-Quds radio station, said Hamas would take advantage of this decision "to release people Israel accused of having blood on their hands like Samir Kantar. We have to take advantage of this to release our prisoners."

Israeli government spokesman Mark Regev would not comment on Zahar's remarks.

Under a June 19 truce between Israel and Hamas, stepped-up negotiations are to begin on Schalit's release, with Egyptian mediation.

Hamas has demanded freedom for hundreds of Palestinian prisoners held in Israeli jails. Israel, which is holding about 10,000 Palestinians, has balked at releasing many of the people on Hamas' list because they have been involved in deadly attacks on Israelis.

Critics of the Lebanese prisoner swap deal have argued that swapping bodies for Kantar would offer militant groups an even greater incentive to capture soldiers and less of a reason to keep captives alive.

"I'm afraid Hamas, drawing a lesson from this deal, will harden its position," Housing Minister Zeev Boim, one of three government ministers to vote against the Hezbollah swap, told Israel Army Radio.

Unlike his comrades in Lebanon, Schalit has sent letters and an audio tape to his parents and is believed to be alive, though he has not been seen since his capture and the Red Cross has not been permitted to visit him.

Finance Minister Ronnie Bar-On, who also voted against the swap, told Israel Radio that the price for Schalit will become so high that it will be difficult to pay it.

Israel's past prisoner swaps traditionally have been lopsided deals. In one hotly contested exchange, Israel in 1985 released 1,150 Arab prisoners, almost all of them Palestinians, in exchange for three soldiers captured by Lebanese guerrillas three years earlier. Some of the freed prisoners later played key roles in a Palestinian uprising against Israel that began in 1987.

Amos Gilad, a retired general involved in the Egyptian-brokered negotiations to free Schalit, told Israel Army Radio that the Cabinet's decision Sunday would have no effect on the talks.

"Hamas' demands regarding Gilad Schalit have been known for some time," he said before Zahar spoke. "They haven't been influenced by the contacts with Hezbollah."

The debate over whether to trade an infamous attacker for two dead soldiers tapped into a military ethos that runs deep within Israeli society, where most young men and many young women perform compulsory service. One of the military's most cherished principles is that it leaves no soldier, dead or alive, behind in the field.

Moshe Arens, a former Israeli defense minister, criticized the Hezbollah deal, saying Israel's previous policy of sending in soldiers to free hostages was better.

"It was clear that negotiating with the terrorists and agreeing to their outrageous demands was simply setting the stage for further kidnappings and higher demands in the future," Arens wrote in an op-ed piece published Monday in Haaretz. "When in past years a policy of negotiating with terrorists for the release of hostages was adopted, it only proved the original premise."

Israel and Hezbollah will be asked to sign a formal deal within a few days, and barring any hitches, the swap is expected to take place within about two weeks, Israeli officials have said.

Boim said Israel missed an opportunity Sunday to gain back some of the ground he says was lost in previous exchanges.

"We had a chance with this deal to change the rules of the game by not accepting it," he said.