The protests underlined a growing disaffection with the Israeli army, the nation's most respected institution.
"Molotov cocktails, stones, nails on the road, and now this. The man was brutally murdered. We are talking about terror against citizens," Ariel resident Shmuel Rafaeli said. "We feel abandoned."
"Israel's security forces will uproot this violence with an iron fist," said Shamir, who blamed Palestinians for the killing and promised swift, harsh punishment.
West Bank police commander Chaim Malka said police suspected Palestinians in the killing, but were investigating all possibilities. Israel Radio reported that 30 suspects were detained for questioning.
Palestinian shepherds found Rosenfeld's body Sunday on a hill between the Arab villages of Salfit and Burkin, said Avivi Shalom, security chief at the Ariel settlement.
Rosenfeld, 48, had been missing since Friday night. He liked hiking and had apparently walked to the barren area from Ariel, Shalom said.
"It seems as though the assailants surprised him and hit him on the head," Shalom said. Rosenfeld's empty pistol holster, map, binoculars and two spent cartridges were found near the body, he said. The knife was still in his body.
Ariel officials said Rosenfeld lived in Washington and was a U.S. Marine before emigrating to Israel in 1968. He fought in Israel's army and edited technical manuals in Tel Aviv before becoming a settler 18 months ago.
With his death, 20 Israelis and more than 500 Palestinians have been killed in the 18-month-old uprising. More than 40 of the Palestinians were killed by other Arabs, many on charges of collaborating with Israel.
Shamir is under increasing pressure from hawks in his right-wing Likud bloc to lay aside his plan for elections in the occupied lands and first put down the revolt.
The Rosenfeld killing led the Likud caucus in the Knesset to call for the establishment of a civil guard made up of settlers. Ariel Mayor Ron Nachman demanded that Israel legalize the death penalty, and Knesset member Yuval Ne'eman of the right-wing Tehiya party told the Jerusalem Post that Israel should move all Palestinian refugee camps to Lebanon.
About 200 protesting settlers honked their horns at 3 a.m. outside the Tel Aviv home of Defense Minister Yitzhak Rabin, chanting "Rabin, resign."
An additional 150 settlers converged on Ariel. Mayor Nachman blamed the government.
"All of them are responsible, especially the (Knesset) members who speak out and put a stigma on us as a group, in order to enable attacks on us," he said. "I see them as directly responsible for this assassination."
"If (army leaders) say there's no solution to the Palestinian uprising, they must 'draw conclusions,' " Nachman said, using the Hebrew euphemism for resignations.
Signs of a growing dissatisfaction with the army are everywhere, and at least three West Bank settlements recently established private armed groups to carry out security tasks they say the army is not performing.
The defense forces repeatedly turned up in public opinion polls since the 1950s as the most respected and trusted institution in Israel.
But the army that crushed Arab militaries in six wars since 1948 now finds itself unable to deal effectively with a popular insurrection and being the target of sharp criticism by rightists and leftists.
Said one British-born army corporal: "Some of the people say we're killing Palestinian babies, and the others say we're not killing enough of them. It's not fun to be in the army anymore."
Rightists have accused army commanders of being "leftists" far too soft on Palestinians. Some even charge that the army is refusing to quell the violence in order to force the government into negotiations with Arabs.
Less stridently, leftists accuse the defense forces of widespread abuses, of unnecessary beatings and shootings that can only corrode the army's moral character and deepen the enmity between Arabs and Jews.