For the first time, a Palestinian president is set to visit the official Jerusalem residence of Israel's president.
Officials say Tuesday's historic talks between Palestinian President Mahmoud Abbas and Israeli President Shimon Peres will focus on promoting the peace process and joint economic projects.
The Palestinian leader told his supporters Tuesday that he may withdraw his police forces from parts of the West Bank because of continuing Israeli military raids.
Mr. Abbas has been beefing up security forces in parts of the West Bank, but said the Israeli raids are undermining his authority and political credibility.
Also Tuesday, Israeli officials say a bulldozer driver went on a rampage in Jerusalem, wounding at least 16 people.
Police say the bulldozer rammed several cars before a civilian bystander and police shot and killed the driver.
Authorities say the driver was a Palestinian man from east Jerusalem. Police have called the incident a terrorist attack and are searching for two suspects.
The attack occurred in a busy part of downtown Jerusalem, near a luxury hotel where U.S. presidential candidate Barack Obama is expected to stay during his visit to Israel later Tuesday.
Earlier this month, a Palestinian bulldozer driver plowed into vehicles and pedestrians, killing three people before he was shot and killed.
Meanwhile, Israel's Kadima Party voted late Monday in favor of changes to its charter that could lead to Mr. Olmert's ouster.
The Israeli prime minister has been embroiled in a corruption investigation, and Kadima officials say the party now expects to hold a leadership vote in September.
Some information for this report was provided by AFP, AP and Reuters.
