Preparations for this year's Christmas celebrations in Bethlehem have been marred by persistent rumors about an impending terrorist attack on some of the city's holy sites and institutions. Many local families are so afraid that they are refusing to allow their children to leave their homes. It's not clear who started the rumors, but what is certain is that residents have been living in a state of panic for several days now. According to the rumors, Jordanian-born terrorist Abu Musab al-Zarqawi, who heads al-Qaida in Iraq, is planning suicide attacks on Bethlehem University, Manger Square and St Joseph's School on the eve of Christmas. "Al-Zarqawi is planning to destroy Bethlehem," the rumors claimed. "It will happen on the eve of Christmas." Al-Zarqawi was last month behind a series of suicide bombings in the Jordanian capital of Amman, where more than 60 people were killed when terrorists detonated their explosive charges in three hotels. "The children in Bethlehem are afraid to leave their homes," a Christian resident told the local Maan news agency. "They are all talking about al-Zarqawi instead of Santa Claus. It's a frightening situation. There's a real state of panic here." A 16-year-old Christian teenager from Bet Sahour expressed deep fear, saying he woud stay away from Manger Square. "Al-Zarqawi is threatening to ruin Christmas celebrations," he said. "We don't know what to do, but this is what I read on the Internet." The Bethlehem municipal council, which discussed the rumors during its weekly meeting, has issued a number of statements urging the local population not to believe the unfounded reports. "This is a destructive rumor that is completely unfounded," said Bethlehem Mayor Victor Batarseh. "It was invented by the fifth column and [Israeli] collaborators and I would like to assure everyone that our city is very safe." Batarseh also dismissed allegations that Hamas, whose representatives control a number of seats in the municipal council, were behind the rumors. He appealed to tourists and pilgrims to visit Bethlehem and to ignore the talk about impending terrorist attacks. A Swedish journalist living in Bethlehem said he too was aware of the rumors which, he added, were having a profound impact on the local residents. "Muslim and Christian families sit in the evening to discuss these rumors at length," he said. "The Muslims are also worried because they too send their children to participate every year in Christmas festivities in Manger Square." A journalist from the city said he had received several phone calls from foreign journalists inquiring about the planned terrorist attacks. "Is it true that al-Zarqawi is planning to blow up Bethlehem?" he quoted one reporter as asking him. A local merchant said that unlike previous years, he was unable to sell most of his goods because of the rumors about al-Zarqawi's imminent terrorist attacks. "Those who are spreading these rumors are causing a lot of damage to Bethlehem," he explained. "Many families have not bought new clothes for their children." At Bethlehem University, which is rumored to be on al-Zarqawi's list, some students have stopped attending classes for fear of being killed or wounded. Sources at the university said that the reason why it was being mentioned as a potential target was because the administration had suspended the activities of the Hamas-affiliated Islamic List. Hamas supporters on campus recently won 10 seats during elections for the student council Since then, Hamas activists in the West Bank have been waging a campaign of incitement against Bethlehem University, accusing its administration of discrimination against Muslim students. A leaflet issued by Hamas supporters in Hebron last week threatened to launch Kassam rockets at the university. Other sources, however, claimed that the university was being targeted for screening a film depicting a Muslim man kissing his wife on the cheek. Teachers and staff members at the university have been working hard to chase away the rumors, but thus far with little success. Musa Darwish, head of the Public Relations Department at the university, said it the source of the rumors remained as mysterious as ever. "Sixty-seven percent of the students here are Muslims," he said. "We have no discrimination here whatsoever and our policy is based on dialogue and respect for other's opinions." Darwish stressed that he disagreed with those Palestinians who claim that Palestinian society was moving towards "Talibanization" [a reference to the Taliban regime in Afghanistan which imposed strict Islamic rules]. "There has been much talk about Taliban phenomena here, but I believe that our society is still far from this." Some Christians are so desperate that they have appealed to Hamas to protect them against al-Zarqawi and al-Qaida. "Hamas must defend Bethlehem against these terrorists," said one. "We have confidence in Hamas and we hope that they won't disappoint us. Our children are so scared that they can't sleep well at night."