A panel of Israeli ministers today agreed to raise the number of Palestinian prisoners who could be released in a swap deal with Hamas, but the Islamist group said the list fell short of its demands.

Prime Minister Ehud Olmert tasked the committee with approving a list of prisoners that could be freed in exchange for Israeli soldier Gilad Shalit, captured by militants from the Gaza Strip in a 2006 cross-border raid.

The Israeli committee, headed by Vice Premier Haim Ramon, backed the release of 450 Palestinian prisoners, about half of whom were on a list submitted by Hamas. The committee had previously authorized the release of 70 names from Hamas's list.

Officials said it was unclear when the expanded list would be brought to the cabinet for consideration.

Scandal-hit Olmert has little time left to clinch a deal. He resigned earlier this week but will remain caretaker prime minister until a new government is sworn in.

Hamas has demanded the staged release of 1,400 prisoners, including those who have carried out violent attacks against Israelis. Hamas said the committee's new recommendations would not advance Egyptian-brokered negotiations over Shalit.

"No breakthrough can be achieved before the Zionist enemy agrees to all the conditions and all the names on the list we had handed over," said senior Hamas leader Osama Al-Muzaini.

About 10,000 Palestinians are imprisoned by Israel. Many Palestinians see them as heroes in the struggle for statehood.

In the past, Israel has balked at releasing prisoners with "blood on their hands", though it has eased its criteria in some cases.

Egypt brokered a ceasefire deal in June between Israel and Hamas, which seized control of the Gaza Strip after routing Palestinian President Mahmoud Abbas's security forces in 2007.

The truce was meant to spur talks to free Shalit, but there has been little progress so far.