Israel raised the level of alert at its embassies abroad and along the northern border on Wednesday as a Hizbullah leader vowed retaliation for the overnight assassination of arch-terrorist and Hizbullah chief operations officer Imad Mughniyeh. Israel denied any involvement in Mughniyeh's killing. Mughniyeh was killed late Tuesday night after a bomb, planted inside the seat of his car, exploded in Damascus's upscale Kafar Soussa neighborhood. Security forces quickly sealed off the area and removed the destroyed car, which had its driver's seat and the rear seat blown away by the blast. Considered Hizbullah's operations chief, Mughniyeh co-founded the group in 1982 together with Hizbullah chief Hassan Nasrallah, and was a member of its ruling Shura Council. He was in charge of all overseas operations, and as the chief operations officer, coordinated Hizbullah relations with the Iranian Revolutionary Guards. Israel held Mughniyeh responsible for numerous terror attacks, including the 1994 bombing of a Buenos Aires Jewish community center, which killed 85, and the bombing of the Israeli Embassy in the city two years earlier. He is also believed to have been behind the 2006 abduction of IDF reservists Eldad Regev and Ehud Goldwasser that sparked the Second Lebanon War. Over the years, Mughniyeh targeted US citizens as well, and he has been implicated in the attack on the US Embassy in Beirut and another on a US Marine barracks there that left more than 200 soldiers dead in 1983. Wanted in at least 40 countries, he has been on the FBI's top-20 terrorist list for years and a $5 million prize was offered to anyone who provided information leading to his capture. Defense officials said it was possible Hizbullah would attack Israeli targets in retaliation for the assassination, although it was unlikely that the group would do so across Israel's northern border. Instead it might use its extensive infrastructure overseas, they said. One former senior intelligence officer told The Jerusalem Post Hizbullah had terrorist infrastructure in more than 50 countries, particularly in Africa and South America. "After events like this, we need to sharpen our senses in preparation for a retaliation attack," a security official said, adding, however, that "security personnel were not being beefed up at this stage." Hizbullah accused Israel of being behind the assassination. "With all pride we declare a great Jihadist leader of the Islamic resistance in Lebanon joining the martyrs... The brother commander hajj Imad Mughniyeh became a martyr at the hands of the Zionist Israelis," read a statement released on the group's Al-Manar television station. A prominent Shi'ite cleric close to Hizbullah called for the group's military wing to retaliate. "Every attack against the resistance [Hizbullah] will be met with a response from the resistance," the head of south Lebanon's religious scholars, Sheikh Afif al-Naboulsi, said on Al-Manar. "An eye for an eye... a person for a person and a leader for a leader." The Prime Minister's Office said in a statement, "Israel is looking into the reports from Lebanon and Syria regarding the death of a senior Hizbullah figure and is studying the details as they have been reported in the media. Israel rejects the attempt by terrorist elements to ascribe to it any involvement whatsoever in this incident." No Israeli officials were prepared to confirm or even hint at Israeli involvement. David Kimche, a former deputy head of the Mossad, told the Post, "The world is definitely a safer place without him." In Washington, the State Department welcomed the news of Mughniyeh's death with the same comment, but stressed it didn't have independent information on the killing. "The world is a better place without this man in it," said State Department spokesman Sean McCormack, who added, "One way or the other he was brought to justice." FBI spokesman Richard Kolko was also quoted as saying, "If this information proves true, it would be considered good news in the ongoing fight against terrorism." He said the agency was waiting for confirmation of Mughniyeh's death and its circumstances. Although much of the American public's attention has been focused on the threat posed by al-Qaida, the National Counterterrorism Center's acting director, Michael Leiter, stressed Wednesday the ongoing challenges presented by the Lebanese Islamist group. "We need no better reminder of the significant threats posed by violent Shi'ite extremists - most notably Hizbullah - than today's reported death of Imad Mughniyeh," Leiter said in an address prepared for the Washington Institute of Near East Studies. Last week, the US director of national intelligence, Michael McConnell, briefed the Senate Select Committee on Intelligence on threats facing America and pointed to Iran's efforts to build up Hizbullah's influence to harm American and Israeli interests. Now there's concern in US intelligence circles about what form a Hizbullah response could take. "I imagine that it's shocking for the organization and it's certainly a big blow," said Michael Jacobson, a senior fellow in the Washington Institute's Stein Program on Counterterrorism and Intelligence. "Do they decide they can't take this lying down and they have to attack whoever they believe is behind it? That seems possible." He added that US and UK intelligence experts, when considering Iran's use of its Hizbullah proxy, have expressed concern that attacks would be directed against US or other Western targets. But on the assumption that Hizbullah would blame Israel for this specific act, diplomatic and Jewish facilities throughout the world could be at risk. At the same time, Jacobson pointed to the strong response delivered to Hizbullah by Israel during the Second Lebanon War in the summer of 2006. Israel gave another blow to Syria - the scene of the Tuesday car bombing that killed Mughniyeh - with an aerial raid in September. That could give Hizbullah second thoughts about immediate retaliatory activities, Jacobson said. But he still warned, "It could be a dangerous period right now in terms of how Hizbullah decides to react." Israeli embassies and Jewish institutions all over the world, such as synagogues, are automatically put on the highest state of alert following such incidents. The high state of alert will only be lowered when intelligence assessments point to a reduced threat of a revenge attack. Ever since the bombing of the AMIA Jewish community center in Buenos Aires in 1994 - an attack thought to have been masterminded by Mughniyeh - Jewish Agency offices worldwide have had the same level of security as Israeli embassies. A number of Jewish Agency buildings were even closed or relocated after security officials ruled that they were vulnerable to terrorist attacks. A spokesman for the Community Security Trust, which provides training and advice for the protection of British Jews and represents British Jewry to police, government and media on anti-Semitism and security issues, said Jewish communities were already on high alert due to the ongoing al-Qaida threat. Johnny Paul in London and AP contributed to this report.