The idea has floated for years on the fringes of the Middle East debate: Opponents of Israeli policy in the largely Palestinian territories of Gaza and the West Bank should divest from companies doing business there.

The concept now is gaining ground in the heart of American Protestantism, pitting U.S. Jewish and Christian leaders against each other.

Leaders of both faiths say the trend is born of deep frustration, as the Palestinian intefadeh enters its fifth year and prospects for a settlement dim.

"I think, at this point in time, the frustration is reaching such a high, that things like this get traction," said Antonios Kireopoulos, an international affairs officer at the National Council of Churches, which represents 36 Protestant and Orthodox Christian denominations.

The Presbyterian Church (U.S.A.) is seeking withdrawal of investments from some companies with ties to the territories, following a vote this summer by its General Assembly. The Socially Responsible Investment panel of the Episcopal Church is researching the idea.

Corinne Whitlach, head of the Washington-based Churches for Middle East Peace, said some Methodists and members of the United Church of Christ want to consider divestment as well.

"The churches that I work with share the view that's very widely held that the very possibility of a two-state solution seems to be increasingly less possible," Whitlach said.

U.S. Jewish leaders have told the Protestants that their approach urging Israeli withdrawal from the occupied territories smacks of bias, since the Christians have made no concurrent demand that the Palestinian Authority work to end suicide bombings against Israelis.

That the divestment campaign borrows from the 1980s movement against South African apartheid is even more unsettling for Jewish leaders.

"Unless you think Israel represents nothing other than colonial imperialism, then there is no analogy to be made at all, and those who call Israel colonial imperialism -- that's a form of blindness, as if Jews have no relationship to the land of Israel," said David Elcott, national head of interreligious affairs for the American Jewish Committee, based in New York.

A meeting of Jewish and Presbyterian leaders last month in New York failed to reach any agreement.

New tensions arose this week when delegates from a Presbyterian policy committee on a fact-finding trip in Lebanon met with leaders of Hezbollah, which the United States and Israel consider a terrorist group. One delegate, church elder Ronald H. Stone of Pittsburgh, said "relations and conversations with Islamic leaders are a lot easier than dealings and dialogue with Jewish leaders." The top Presbyterian executive said the comments do not reflect the official position of the church, which he says condemns terrorism.

Relations between Jewish and mainline Protestant leaders were already poor when the divestment proposal surfaced at the Presbyterian national meeting. The Protestants felt that some Jewish leaders had become so hawkish in their defense of Israeli policy that dialogue on the issue would not be productive.Jewish leaders say divestment would only hurt the Palestinians, by hardening Israel against a negotiated settlement. Also, only a few companies have ties to the Israeli territories, and it is unclear whether the churches can pressure them to change. One company that the Presbyterians may target is Caterpillar Inc., which makes heavy construction equipment.

"Churches that really want to make an impact on the situation need to look at both sides and be as firm condemning terrorism as condemning Israeli practices," said Lewis Roth of Americans for Peace Now, which supports a negotiated settlement with the Palestinians.