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JERUSALEM — Violent anti-Semitic acts dropped significantly worldwide last year. But anti-Semitic sentiment, particularly on the Internet, remained stable or increased, according to a report released Sunday in Jerusalem.

Moreover, new demands for the return of Jewish property confiscated during the Holocaust have spurred local Holocaust deniers who say these campaigns are another attempt at international Jewish blackmail, according to the report.

The report, "Antisemitism Worldwide, 1996/7," by Tel Aviv University's Project for the Study of Anti-Semitism, in conjunction with the Anti-Defamation League and the World Jewish Congress, said violent incidents involving weapons dropped from 72 in 1994 to 32 in 1996, and violent incidents without weapons from 232 in 1994 to 165 last year.

Only Australia registered an increase, where such incidents rose 12 percent.

Dr. Dina Porat, who heads the project, attributed the change to increased legislation against anti-Semitism and racism and better enforcement, particularly in Europe.

"The Europeans understand that anti-Semitism does not exist alone, but is rather a part of a larger climate of racism and fanaticism which can express itself in violence, making it a pan-European problem of which anti-Semitism is just a part."

But Porat also noted a sharp rise in the power of radical right-wing political parties in Europe, like that of Jean-Marie Le Pen in France, Jorg Haider in Austria and Filip Dewinter in Belgium, all of whose groups include anti-Semitic elements in their agendas.

The "Swiss Gold" affair has aroused conflicting responses, according to the report. While some, mainly in the West, see the Jews as "fighters for deprived rights and property," others are using the claims "for renewed anti-Semitic arguments and activity," the report says.

"The very fact that we dealt with real estate, with property, is something that really touched a very sensitive nerve in the European collective psychology," said Dr. Avi Beker, executive director of the World Jewish Congress' Israel office.

"For so many years, it was quite easy for many European nations to say that `the Nazis did it.'

"But when you deal with the property, when you deal with human beings whose belongings were taken from them before they went to the death camps, you are really realizing that this mass murder couldn't take place without very close cooperation of local populations and local authorities in several countries."

Some of the world's most virulent anti-Semitism appeared in the Arab press, where there was a "significant increase" in the number of anti-Semitic articles or cartoons, according to Esther Webman, a project researcher.

Politics is just "an excuse" for such items, with motifs similar to those used throughout the world: the Jew as the spreader of drugs or AIDS, and as a generally corrupt human being, she said.

Webman said the articles peaked during Israel's accidental bombing of a U.N. base in southern Lebanon during Operation Grapes of Wrath.

Benjamin Netanyahu's election as Israeli prime minister also spurred Holocaust analogies, including one photograph in Egypt's al-Dustar newspaper last October showing Netanyahu with a swastika on his forehead.

More Egyptian journalists and writers had agreed to discuss this phenomenon, she said, perhaps because of pressure by Jewish groups in Washington. Nonetheless, Webman said, there was a rise in the Arab media's use of Nazi-style "characters and ideas" aimed at "demonizing Israel."

According to the report, violent anti-Semitic acts in the United States fell 11 percent from 1,843 in 1995 to 1,712 last year.

However, Harry Wall, director of the Anti-Defamation League's Israel office, said U.S. Jews still face anti-Semitism, particularly on the Internet and from political figures such as Nation of Islam leader Louis Farrakhan.

"The Internet and e-mail gives anti-Semites the potential to reach millions of people with their propaganda denying the Holocaust, whereas it was once limited to radical people who put out pamphlets on the streets or sent it out by mail," Wall said.

The ADL and other organizations are fighting this phenomenon, he added, "but there is a problem regarding [respect for] freedom of speech and with the technology."

Cost-effective, quick and able to transfer large amounts of material, the Internet has become the new playground of hate groups, according to a special chapter entitled "Antisemitism on the Internet," by David Sitman, in the TAU report issued Sunday.

According to cabinet secretary Danny Naveh, a member of a forum that monitors anti-Semitism, some 200 sites are now proferring such material. Most material still comes from the United States and Canada and is in English, but some in other languages is also online.

Material is offered via the World Wide Web or via Usenet newsgroups, and includes sites run by Holocaust deniers such as the Committee for Open Debate on the Holocaust (www.codoh.com), White Pride and Racial Diversity (www.whitepower.com); or JWS Militant Knights of the Ku Klux Klan (www.mindspring. com/~creativity/Creator). The most popular is the Zundelsite, (www.webcom.com/~exundel/english), run by Ernst Zundel, who Sitman says is careful never to overtly attack Jews, but who insists Hitler never gave an order to eradicate the Jews.

Anti-Semitic Muslims are also out there, as in Radio Islam (www.flashback.se/~rislam). Christian anti-Semites are also on the Net, as in the Aryan Nation site of Richard Butler (www.stormfront.org/an.htm).

Meanwhile, anti-Semitic incidents in England fell 8.1 percent, continuing a three-year trend, which the report attributed to better policing, communal security and a reduction in the dissemination of anti-Semitic literature.

But anti-Semitic acts climbed in South Africa in 1996 due to Mideast politics, the report said.

Several graves were desecrated in Pretoria and Bloemfontein, and slogans and swastikas were daubed on buildings. Two Jewish institutions received bomb threats, the report said.

Anti-Semitic incidents were down 26.3 percent in Canada, attributed to the demise of some anti-Semitic groups, and overall improved community vigilance and education.

Nonetheless, a Jewish National Fund office in Calgary received a package bomb that hurt an employee.