JERUSALEM, March 24 (Reuters) - Israel has decided against buying a U.S.-produced anti-rocket laser for the border with the Hamas-run Gaza Strip because of the device's poor performance in field tests, a top Israeli defence official said on Monday.

Israeli state arms firm Rafael is developing Iron Dome, which is designed to shoot down Palestinian rockets from Gaza with miniature missiles, but that system is not expected to be operational before 2010.

Seeking a stop-gap countermeasure, Defence Ministry director-general Pinchas Buchris flew to the United States last week to re-evaluate Nautilus, an Israeli-U.S. invention that uses a laser to blow up rockets and mortar bombs mid-flight. Israeli experts had previously written off Nautilus -- which is being upgraded under a new name, Skyguard -- as unreliable, and Israel's Army Radio said Buchris had found little improvement.

"Were we to order it as is, to protect Sderot, we would create two things," Buchris told the station, referring to an Israeli border town under frequent Gazan rocket barrages.

"First, there would be the illusion, for Sderot residents, that it provides a response. Another thing, we would create a situation where Hamas felt it had scored an achievement in that ... we have no way of coping with the Qassams (rockets)."

Israel has also been looking at Phalanx, an automated cannon made by U.S. firm Raytheon that shreds incoming shells. Rockets launched from Gaza -- which Israel quit in 2005, giving Hamas a major political boost -- cause relatively few casualties but have paralysed Sderot and other border towns.

The salvoes have ramifications for Israel's peace talks with Hamas's rival, Palestinian President Mahmoud Abbas. Barak would likely insist that any deal ceding the West Bank to Abbas be conditioned on deployment of a working anti-rocket apparatus. (Writing by Dan Williams, Editing by Michael Winfrey)

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