Italian police discovered eight bullet-ridden bodies today in a district of the Sicilian capital, Palermo, that has been the scene of gangland warfare between rival factions of the Mafia.

It was the largest single mass killing in recent memory in Palermo, and it coincides with a major offensive by Italian authorities against the Sicily-based crime organization. During the past two weeks, dozens of Mafia members have been arrested following the confessions of Tommaso Buscetta, a former mob leader who was extradited from the United States to Italy in July.

Italian investigators speculated that the massacre, which apparently took place Wednesday evening, could be linked in some way to Buscetta's testimony. They said that it bore the hallmarks of a "settling of accounts" ordered at a senior level in the organization.

The bodies of the eight victims were discovered early this morning in a pool of blood and urine following an anonymous telephone call to the police. They were lying next to a stable at the end of a blind alley in a seedy, working class district that has been the center of criminal racketeering for many years.

When police arrived on the scene, the weeping father of one of the victims was attempting to drag away the body of his son, 24-year-old Paolo Canale. Most of the dead were identified as petty criminals wanted by police on charges such as robbery and illegal possession of arms.

If widely held suspicions of a Mafia connection are confirmed, the incident would appear to point to deepening divisions in an organization that once prided itself on its unity and discipline. Buscetta's decision to testify to Italian magistrates marked a dramatic breach of the age-old Sicilian tradition of omerta -- the code of silence to which all Mafia members were sworn.

But the killings also are a painful reminder that, while it may have been weakened as a result of the recent crackdown, the Mafia has not been crushed. According to Italian police, about 500 persons have been killed in gangland battles in Sicily and southern Italy during the past four years.

The Palermo massacre appeared to bear some similarities to a mass killing that took place last August near Naples when eight persons were mowed down by a gunman firing from a passing bus. The tragedy was attributed at the time to internal strife within the Neapolitan branch of the Mafia, known as the Camorra.

Like the Mafia, the Camorra has been weakened in recent months by the revelations of informers. Many of its leaders are in jail.

A senior Italian magistrate who has been leading the investigation into the Mafia, Judge Giovanni Falcone, said that the Palermo slayings could have been approved by a "commission" of heads of Mafia families -- the existence of which was revealed by Buscetta.

According to Buscetta's testimony, Sicilian crime families are organized in a pyramid-like hierarchy headed by a commission. Families may gain or lose seats on the commission -- the equivalent of a board of directors -- according to the rise and fall of their influence.

Other investigators noted that the mass murder occurred on "territory" controlled by a fugitive Mafia boss, Filippo Marchese.

According to leaks in the Italian press, Marchese has been accused by Buscetta of ordering the murder of members of his own family who refused to accept his authority.

Buscetta, 56, who is a native of Palermo, is reported to have supported the rival clique in the Marchese family. During the past few years, the two factions were involved in a feud, from which Filippo Marchese emerged triumphant.

The open warfare in the "Corso dei Mille" district of Palermo was dramatic even by Mafia standards in that it tore a single family apart. Seven of Marchese's close relatives were murdered in the past three years.

Talking to journalists after the massacre, Judge Falcone said it was wrong to strike a triumphant note following the anti-Mafia crackdown, but he also cautioned against defeatism.