Israeli Prime Minister Ariel Sharon has forbidden the practice until now, these sources said, speaking on condition of anonymity.
The Israeli statements were confirmed by more than a half dozen former and currently serving U.S. foreign policy and intelligence officials in interviews with United Press International.
But an official at the Israeli Embassy in Washington told UPI: "That is rubbish. It is completely untrue. Israel and the United States have such a close and co-operative intelligence relationship, especially in the field of counter-terrorism, that the assertion is ludicrous."
With the appointment of Meir Dagan, the new director of Israel's Mossad secret intelligence service, Sharon is preparing "a huge budget" increase for the spy agency as part of "a tougher stance in fighting global jihad (or holy war)," one Israeli official said.
Since Sharon became Israeli prime minister, Tel Aviv has mainly limited its practice of targeted killings to the West Bank and Gaza because "no one wanted such operations on their territory," a former Israeli intelligence official said.