Lally Weymouth: Why did you decide that disengagement is the right thing to do?

Ariel Sharon: I saw that it was very important to take this decision. I never thought there would be any possibility that a small Jewish minority in Gaza -- seven or eight thousand Israelis, [living] among 1.2 million Palestinians whose numbers double every generation -- might become a majority or [establish] a place that could be an integral part of the state of Israel.

What is next in the peace process?

No one can impose upon Israel any plan, only what has been agreed upon, such as the road map [put forth by the Bush administration in 2002].

So that's where you would go next, to phase one of the road map?

Yes, the only plan that exists is the road map. We are not in the road map yet. We are in the pre-road map phase now. To enter the road map, there should be a full cessation of terror, hostilities and incitement. The Palestinian Authority should dismantle the terrorist organizations, collect their weapons and implement serious reforms in [the] security [services]. Once they take these steps, we will be able to start negotiations along the road map plan.

But the road map calls for the Palestinians to dismantle the infrastructure of terrorism in phase one.

To start the road map negotiations, they have to first dismantle the terrorist organizations and cease terrorism, so it's not an automatic thing.

You mean Hamas and company?

Yes. Hamas and the Islamic Jihad, but there are other terrorist organizations there. When we leave [Gaza], our reaction if terror will continue will be very, very hard. Once we're not there . . . they don't have any reason to continue shooting.

Benjamin Netanyahu is challenging you inside your own party, the Likud. Will you stay and fight or form another party?

I think the former minister of finance wants very much to be prime minister so he decided to make every effort to have early elections and early primaries. I don't think that's the right way. We are in the middle of important steps in every field -- negotiations, security -- and we have to act against poverty and do more in education. Netanyahu became the leader of the most extreme right group here and that of course will affect the possibility to continue negotiations.

People in Likud are angry at you -- they feel betrayed.

There are some internal problems, incitement and hatred. . . . But I believe I will overcome that.

What about reports that you'll split the party or form a new party?

I prefer to stay with Likud. I think I have to be in the party I managed to build.

So you're going to fight for the Likud nomination?

I'm not going to surrender. And I don't see why I should be ousted.

But if the Likud is going to vote against you, you're not just going to sit there and be beaten by Mr. Netanyahu, right?

No one wants to be beaten, even myself.

Have you made your last concession? Do you think the rest is for other generations?

I don't think I made any concessions.

Okay, but have you made your last bold move forward?

Yes, I think it was a bold move. You can see what happened to me here in the internal politics.

The U.S. wants you to dismantle illegal outposts [on the West Bank]. Are you going to do that?

We'll do that. We call them unauthorized outposts.

Will some settlements go, or will all of them stay?

The major blocs will stay as part of Israel. As to others, according to the road map, that is the last thing we have to negotiate. You asked if we are building -- yes, we have small-scale construction within the [settlement] lines.

So you'll strengthen the settlement blocks?

Yes. There are altogether about a quarter of a million people living in these areas. And there are big families. Generally speaking, the places where we are building are in the major blocks of population.

How will the U.S. react?

I don't think they'll be too happy, but they are the major blocks, and we must build. We don't have an agreement with the United States about this, but these areas are going to be part of Israel.

You've started building?

Even now there is construction.

How do you see [Palestinian leader] Abu Mazen? Is he different from [Yasser] Arafat?

Abu Mazen understands the danger of terror. I think he understands that the suffering of the Palestinians was caused mostly by terror. The question is will he be willing to take serious steps to dismantle terrorist organizations, to collect their weapons.

You're talking about dismantling Hamas?

Yes, it should be dismantled. I think it's very important for him. The problem is that Abu Mazen signed an agreement with the Hamas and the Islamic Jihad. He took upon himself [to say] that they would be able to participate in political life in the Palestinian Authority and the elections, and that he would not dismantle their [military] organizations. He signed it several weeks ago in Egypt.

And Hamas is also close to Iran, right?

Very close to Iran and to Hezbollah. We believe that Hamas should not participate in the elections because we don't think that an armed organization can participate in elections . . .

Reportedly Hamas will win between 30 and 40 percent of the Palestinian legislature in the upcoming January elections.

Abu Mazen may have become stronger now. I believe maybe this is the situation.

Why?

Maybe it's a result of our pulling out from Gaza. That doesn't mean that the Hamas gave up their intentions.

Does that mean Abu Mazen could feel more empowered to strike against Hamas?

No, he signed an agreement with them. It is a major problem.

Why did he sign the agreement?

By this agreement he got the ceasefire.

Are there a lot of threats against your life because of the disengagement?

Yes. For many years security steps were taken against acts of Arab terror. Now they are doubled against Arab terror and Jewish terror, and there is terrible incitement.

But now there are more threats from Jews against you?

Once it was only from Arabs. Now it comes from both directions. But I've seen it all, it doesn't affect my work -- I do what I have to do.

Will there be a big peace dividend from Gaza, from the withdrawal?

We didn't do it for that reason, but I think the position of Israel in the world is much better right now. I can see it because there are so many visits here and I think it's important because Israel is a tiny country. It's important to settle our relations with other countries and with the Muslim world. . . . I would like to make a major effort to solve the problems between us and the Arabs.

What do you mean by a major effort?

To talk and negotiate . . .

And give up some of the West Bank in exchange for their concessions?

We're not going to have another disengagement.

But if they fulfill their part.

We are not going to make any steps alone. We have taken a very fateful step -- extreme in its nature. I decided I was going to do it and I did it. There were people who thought I wouldn't do it, as you know.

So you think you can actually make some progress with Abu Mazen?

If he will do his part, I think we can do many things, but he must do his part. If he'll do his part, I believe that we can move forward.

SHARON