When Prime Minister Ehud Barak struck a deal last week to dismantle a handful of Jewish encampments on remote hilltops in the West Bank, the hurrahs in Israel were nearly universal.

Jewish settlers celebrated the bargain as a victory, since it left intact several dozen other outposts planted on hilltops within the past year. The government also claimed a triumph and an important precedent: It was no longer unthinkable that settlers, through negotiation, could cede land claimed by both Arabs and Jews.

Palestinians denounced the accord, repeating their view that all the settlements were illegal and had to come down. But in the Israeli media, more concerned with internal Israeli debate, critics hailed the accord as a deft political maneuver and a hopeful sign of conciliation.

Today, reality set in.

When the council representing Jewish settlers went to haul away a single yellow shipping container atop a lonely rise known as Hill 804, it was stopped in its tracks by a small group of young ultra-nationalist settlers. The settler leaders backed down, the hilltop was not cleared, and the young hard-liners promised to obstruct any further efforts to loosen the Jewish hold on West Bank hilltops.

It was, said analysts, a sign of possible trouble to come next year, when Barak has promised to secure a final peace deal with Palestinians under which an undetermined number of larger, older Jewish settlements are likely to fall under Palestinian jurisdiction and have to be abandoned. And it was a reminder for Israelis that pockets of Jewish ultra-nationalists who insist on Israel's claim to the entire West Bank remain ready to stand in the way of even modest compromises.

"It's certainly not going to be easy to evacuate more settlements next year," said Ehud Spinzak, a political scientist at Hebrew University in Jerusalem who specializes in Israel's extreme right.

Beni Kashriel, chairman of the Council of Jewish Settlements in the West Bank and Gaza, said: "Today, we are not even talking about [evacuating] a real settlement. If they try to evacuate our real communities, for us this is a red line, and it cannot be crossed."

What to do about 170,000 Jewish settlers in more than 145 communities in the West Bank is among the most explosive issues facing Barak as he navigates Israel toward a comprehensive peace accord with the Palestinians. His strategy so far has been to treat them with sympathy and praise, to cultivate their leadership and marginalize their more extreme elements.

But the limits of such an approach may have been revealed today on Hill 804, when the settlement council's leadership was defeated by a couple of dozen hard-line members of a group calling itself Next Generation. The members of that group, most of them in their twenties, combine tactics and an aesthetic that is part hippie, part right-wing ideologue. They danced in a circle, sang nationalist songs and placed tires and boulders the size of beach balls in the dirt-track road leading up to Hill 804--so named because it is that many meters above sea level.

The tires and boulders blocked a flatbed truck from coming up and removing a shipping container full of equipment. The container had been placed there recently by the settlers as part of an effort to control more West Bank land--and thereby prevent it from becoming part of what may become a Palestinian state in parts of the Gaza Strip and West Bank that Israel captured from Egyptian and Jordanian control in the 1967 Middle East war. Israeli troops were present at times during the hours-long stand-off but did not interfere.

The confrontation at Hill 804 revealed a generational split in the settler movement and gave new prominence to the younger, more radical and mostly ultra-religious Jews who regard any compromise on settlements as a sellout. To them, the West Bank is part of the greater Land of Israel, given by God to the Jews forever and therefore not subject to political horse-trading.

"If that's their job, to evacuate settlements, the [settler] council can resign," one young man from Next Generation told Israeli television.

The confrontation has its roots in an agreement signed last year at Maryland's Wye River Plantation that revived the peace process between Israel and the Palestinians. Immediately after the accord, Jewish settlers in the West Bank, encouraged by then-foreign minister Ariel Sharon, began occupying hilltops to cement their control over the land. The outposts they established, 42 in all, are often no more than a few trailer homes, a generator, water tank and storage shed. Typically, no more than a handful of families live on each hilltop stronghold.

Wary of confrontation, Barak, who took office in July, moved cautiously on the settlements. In his first three months in office, his housing ministry approved expansion of existing settlements by 2,600 units--mostly in settlements near Jerusalem that the government is determined to retain in any final deal with the Palestinians. At the same time, the Israeli army, which administers the West Bank, determined that 35 of the 42 new hilltop encampments lacked at least some of the required construction permits.

Last week, using criteria that remain mysterious, the government decreed that 15 of the hilltop strongholds would be dismantled. Then, in long hours of bargaining with settlement leaders, the government reduced that number to 12, five of which are uninhabited, according to settlement leaders.

As with many of the debates about the peace process in Israel, the Palestinians seemed strangely absent, even though they are Israel's interlocutors at the negotiating table. A top Palestinian official, Yasser Abed Rabbo, called the settlement deal "a policy of [land] robbery." Palestinian leader Yasser Arafat declared today that Barak had agreed in the latest peace accords to dismantle all the outposts, but no one in the Israeli political establishment appeared to be listening; this was a debate among Israelis.

On the numbers, at least, the deal seemed a victory for the settlers. No more than three or four dozen families would have to leave their hilltop homes; two or three times as many would be able to stay. And several of the evacuated outposts will be relocated just a few hundred yards away. Nevertheless, the government established the principle that illegal outposts could be dismantled, which had never been done before on the West Bank.

Since the evacuation of the hilltop encampments was to be "voluntary," the settler leaders agreed to carry it out, without government assistance. The government was also eager to avoid any confrontation between extremist settlers and army troops or police.

And so the truck that arrived at Hill 804 this morning was sent by the settlement leaders, leading to the somewhat bizarre spectacle of settlers facing off against settlers.

Settlement leaders blamed the government for publicizing the evacuation ahead of time, giving the Next Generation activists the notice they needed to obstruct the move. They pledged to carry out the deal and to return soon to dismantle the outpost atop Hill 804 out of the glare of publicity, possibly at night. And they said that another uninhabited hilltop encampment, not far from Hill 804, was taken down later in the day.

CAPTION: A Next Generation member prays at the outpost on Hill 804, which the group blocked other settlers from dismantling.

CAPTION: Waving an Israeli flag, members of the ultra-nationalist Next Generation dance as they prevent the dismantling of the encampment atop Hill 804.