Two people were killed and 15 wounded in fierce clashes on Saturday at Lebanon's largest refugee camp near the southern port of Sidon, Palestinian officials and medics said.
The fighting in Ain al-Hilweh involved Islamist militants and members of Palestinian president Mahmud Abbas's Fatah movement.
"Two members of Fatah were killed and six other members were wounded in the fighting," a Fatah official told AFP, speaking on condition of anonymity.
Local medical sources said 15 people -- both civilians and fighters -- had been wounded, some critically.
A Palestinian security official said the fighting erupted when Islamist militants shot at Abu Ashraf Armoushi, a Fatah military official, as he attended a funeral.
An AFP correspondent said the fighting turned into street battles, with Ain al-Hilweh's narrow alleyways ringing to the sound of gunfire and rockets.
The clashes took place mostly near the camp's northern entrance, and dozens of fearful families fled to mosques in nearby Sidon, the correspondent said.
By early evening, the warring sides had agreed to a fragile ceasefire, another Palestinian official told AFP.
The impoverished Ain al-Hilweh has gained notoriety as a refuge for extremists and fugitives and for the settling of scores between factions.
By long-standing convention, the army does not enter the Palestinian refugee camps, leaving the factions themselves to handle security.
On Saturday, Lebanese soldiers called in reinforcements and tightened security around the camp's four main entrances, allowing in only ambulances.
Tensions between Islamists and Fatah have risen in recent months in Ain al-Hilweh. In July, two people were killed in clashes between the two sides.
More than 450,000 Palestinians are registered in Lebanon with the United Nations Relief and Works Agency for Palestinian refugees.
Most live in squalid conditions in the country's 12 official refugee camps.