The ambush took place near an ultra-Orthodox Jewish settlement between the towns of Nablus and Qalqilya.
The gunmen fled the scene after the attack and were being pursued by Israeli army helicopters.
According to Israeli Radio, some victims heard several smaller explosions after the main explosion. The continuing blasts kept rescue personnel from being able to immediately reach the scene, as Israeli security officials feared other possible explosive devices.
The Al-Aqsa Martyrs Brigades, a group that has been linked to Palestinian President Yasser Arafat’s Fatah movement, claimed responsibility for the ambush.
The Agence France Presse news agency quoted a bus company spokesman as saying the targeted vehicle was “one of the most attack-proof we have for going into the territories to protect against terror attacks.”
An ambush on a bus in the same area Dec. 12 killed 11 Israelis. Tuesday’s attack was the first since June 20, when a Palestinian attacker shot five Israelis in Itamar, another Jewish settlement in the West Bank.
Israel blames Yasser Arafat’s Palestinian Authority for the attack, which occurred hours before new talks on the Middle East were due to begin in New York.
Israeli government spokesman David Baker said the attack was “further proof that the Palestinian Authority considers terrorism a primary mode of operation.”
The Palestinian Authority did not offer any immediate reaction. Palestinian officials have said that with Israel controlling most West Bank cities and towns, their security is unable to prevent such strikes.
The Bush administration condemned the attack. White House press secretary Ari Fleischer said the ambush “underscores the importance of focusing on peace and working with leaders in the Palestinian Authority who are dedicated to peace.”
Meanwhile, talks aimed at creating potential solutions to the continuing violence continued in New York among representatives from Russia, the United Nations, the European Union and the United States. The group also plans to discuss President Bush’s call for reform and a change of leadership within the Palestinian Authority.