Chilled by the March winds in the Galilee and eager to hitch a ride to his kibbutz, Army reserve soldier Yosef Levi last month climbed gratefully into the front seat of the car carrying two men with unmistakably Arabic accents but bearing the distinctive yellow license plates that identify an Israeli-owned car. He casually tucked his M16 rifle between his feet as the car sped off on the darkened road.

A few minutes later, the passenger sitting in the back seat suddenly leaned forward and stabbed the 46-year-old soldier in the chest, slashing viciously as Levi struggled for his life. The car swerved off the highway and Levi, covered with blood, fought with his assailants for several minutes until they fled, one in the car and the other by foot.

"I was stupid to get into that car," Levi said later.

Eleven days after Levi's narrow escape, in a move unrelated to that case, Israeli police raided several houses in the Galilee and arrested a dozen young Arabs they said belonged to George Habash's Popular Front for the Liberation of Palestine and were responsible for the murders of two other hitchhiking Israeli soldiers in the last two years.

Such attacks, and subsequent arrests of Arabs, are not extraordinary in Israel. But, according to some Israeli security officials, those and similar incidents underline a potentially ominous trend in Arab-Israeli relations in the Jewish state: the suspected assailants in each of the cases were Israeli citizens who, by law at least, enjoy the same constitutional rights as any Jewish citizen of Israel.

There is no evidence to suggest yet that large numbers of longtime Arab citizens of Israel have abandoned their allegiance to the country they accepted as their own and have turned to terrorism. Several senior officials closely involved in Arab-Israeli relations -- and also a number of Israeli Arab leaders -- said, however, they are growing increasingly concerned about a rise in extreme Palestinian nationalism among young Arabs who hold Israeli citizenship.

They are separated from their Arab brethren in the occupied West Bank by only a few miles with no obstacles to communicating, and are growing increasingly dispirited as opportunities for a peaceful settlement of the Arab-Israeli conflict appear to come and go. Many young men among the 730,000 Arabs of Israel appear to be turning their backs on the moderate majority, either by joining the struggle between the Arabs' two stridently nationalistic political parties or by militantly confronting the Israeli state.

"Lately you can count more and more Israeli Arabs involved with terrorist groups," said Amnon Linn, who for 20 years was head of the Arab affairs department of the Labor Party and now is a member of the Knesset (parliament) subcommittee on the occupied areas. "We are taking very strong measures, and you will hear more about them in the future. But if we don't do something now to strengthen the moderates and support them, while taking measures against extremist groups, we will be faced with a severe problem."

The rise in extremism, according to Yosef Ginat, an adviser on Arab affairs to Prime Minister Shimon Peres, manifests itself not so much in expressions of Palestinian nationalism as in polarization between Israeli Arabs and the Jewish-run government over what the Arabs perceive as economic and social discrimination and a systematic government program to dispossess them of their land.

"They are becoming more extreme, but not more Palestinian. When you look deeply into their motivation, it is the outside that is Palestinian nationalism, but the core is the local problems they have. Where this extremism leads depends on how we as a government deal with their problems," Ginat said in an interview.

Demographics, Ginat and other Arab affairs experts said, is also central to the question. When Israel gained independence in 1948, about 150,000 Arabs elected not to leave for what was then the Jordanian-controlled West Bank. Largely because of a birthrate more than twice that of Jewish Israelis, there are now 730,000 Arabs with Israeli citizenship, more than half of them under the age of 18 and 70 percent under 30. Most live in either the Galilee or the "Triangle," which borders the northern part of the West Bank.

It is this proximity to fervently nationalistic Palestinians in the West Bank, coupled with mounting resentment over their own standard of living, that has contributed to Israeli Arab attacks on Israeli Jews inside Israel.

Mixed terror squads of Israeli Arabs and stateless West Bank Palestinians are being formed by various factions of the Palestine Liberation Organization and are operating as "pivotal units" on both sides of the line separating Israel proper from the West Bank, a senior officer in the Army command said.

"It is an ominous trend in which the murder of soldiers and other Israelis was [perpetrated] with the participation of Israeli Arabs. No doubt this was an operational decision by the terror groups because it makes it easier for them," added the Army officer, who asked that he not be identified.

"The Arabs of Israel have a serious problem with their split identity, and admittedly they are not able to realize all of their rights in Israel. So some may turn to terrorist activity. I'm sure that when they are recruited, this problem of identity is exploited," the official said.

He added, "If you want to kill an Israeli or kidnap a soldier, you have a greater chance of succeeding if you use a car with yellow plates than if you use one with [West Bank] blue plates." Also, he said, Israeli travelers tend to be less cautious inside Israel than in the occupied territories.

The problem would be worse, he said, if the environment in Israeli Arab towns and villages were more supportive of terror activity. But with Israeli Arab leaders constantly condemning terror attacks, members of such groups find it more difficult to obtain refuge inside Israel than in the West Bank.

Tewfik Toubi, one of six Israeli Arabs elected to the Knesset, said that an increase in Israeli Arab extremism could be traced mainly to resentment over inequality of rights, expropriation of Arab land for Jewish settlements and kibbutzim, economic deprivation and reaction to right-wing extremism in Jewish society.

Palestinian nationalism, he said, is important because Israeli Arabs want a Palestinian state in the West Bank for their fellow Arabs there, but not for themselves.

"We argued with the PLO. We opposed the secular democratic state they proposed in all of Palestine because this means the liquidation of the state of Israel," said Toubi, a member of the Democratic Front for Peace and Equality, a Marxist party.

He added, "No Israeli Arab will ever think of leaving his town or his homeland. This is our homeland. They will stay and struggle for their rights, but they will fight as Israeli citizens."

But, Toubi said, because of Jewish expropriations, the total area of Arab-owned land in Israel has fallen from 250,000 acres in 1949 to 125,000 acres now in what he termed "a deliberate policy of enclosing the Arab population." It is the loss of land, he said, that most contributes to youthful extremism.

"To tell you that I'm not disturbed would be unrealistic. This engulfs dangers to both Arabs and Israel. It means new wars, new conflicts and new internal explosions. But the source of these dangers is also the continued occupation" of the West Bank, Toubi said.

Toubi's party, with four seats in the Knesset, is the dominant political party in the Israeli Arab community. But it has been engaged in a power struggle recently with the two-seat Progressive List for Peace Party, headed by Knesset member Mohammed Miari.

Miari, in an interview, listed complaints against the Israeli government, including job discrimination, denial of water rights, restrictions on farming that is competitive with Jewish agriculture, limitations on local Arab rule and land expropriation.

Reflecting the more nationalistic approach of his party, Miari said, "All the time we were part of the Palestinian people. We remained here on our land, but everybody has relatives in refugee camps, whether in Lebanon or the West Bank. Like them, we demand a separate state for the Palestinian people, and we will fight to get it."

He said that while his party favors nonviolent means of achieving that aim, it was inevitable that the younger generation of Israeli Arabs would become more militant with each passing year of Israeli occupation of the West Bank.

"They are Israelis also. But they are not going to sit quiet while the Palestinian people's rights are denied year after year," Miari said.

In the Arab Triangle village of Taibe, Musawa Abu Isba, a member of the militant Al-Anahda (Revival) Party and a member of the municipal council, bitterly assailed Toubi's party, saying that it had "sold out" to the Jews of Israel.

"We want a Palestinian state, but they consider themselves Israeli," said Isba, who is an Israeli citizen. He added, "We are represented by the PLO. Rakah [the Democratic Front for Peace and Equality] is represented by the Israeli government. We may be weaker now, but we are getting stronger."

While stressing that the creation of an independent Palestinian state in the West Bank was out of the question, Ginat, Peres' Arab affairs adviser, said the government could adopt many measures to counter rising extremism among young Arabs of Israel.

"The main problem is, we don't know the Arabs and the Arabs don't know us. We need more communication. The Israeli Arab wants equal opportunities, and the more we can provide opportunity for them, the less incentive there will be for extremism," Ginat said.

He said the government had recently ordered several steps to improve relations with Israeli Arabs: reducing from 16,000 acres to 2,200 acres the amount of Galilee land that was ordered closed to Arab use because the Army wanted it for military maneuvers; the building of new housing projects for Israeli Bedouins who were displaced by government decree; and the creation of a development fund for which millions of dollars are being sought abroad to assist Israeli Arabs.

"We want to find a formula on how to avoid an escalation of tensions with the Arabs of Israel. The Israeli Arab, as a minority, is unparalleled. There is a unique relationship that you can't find anywhere in the world, and we have to learn how to deal with it," Ginat said.