A masked gunman shot dead Jose Luis Caso on Thursday night, while he was drinking wine with friends in a bar in Irun near the French border.
The shooting held cruel echoes of a killing in July that brought millions of Spaniards on to the streets in protest. Mr Caso, 64, a member of the ruling right-of-centre Popular Party (PP), had received threats of "you are next" just days after Eta killed Miguel Angel Blanco in the summer. But he had refused the government's offer to give him bodyguards. "I am not afraid. If they want to come for me they know where to find me," he said recently.
Eta, which stands for Basque Homeland and Freedom, has killed more than 800 people in a 29-year campaign for an independent Basque state. Caso was the 13th victim this year.
Jaime Mayor Oreja, the interior minister, condemned the shooting as a "revenge attack following recent setbacks". A similar attack last week on a PP councillor from San Sebastian was foiled by her bodyguard who was shot in the face and lost an eye.
Basque pacifist organisations called for protest vigils last night, and all Basque democratic parties called for a mass demonstration in San Sebastian this evening.
Mr Mayor Oreja flew to Irun to join the family of Mr Caso, a retired shipyard welder and councillor for the industrial suburb of Renteria since 1995. The Spanish Prime Minister, Jose Maria Aznar, attending a European Union summit in Luxembourg, insisted that the government would not back down in its fight against the separatist guerrillas. Mr Aznar was expected to attend the funeral today.
The conservative Basque nationalist leader Antonio Ardanza, who has long urged dialogue with the separatists, said the attack "was a cynical kick in the teeth for all those seeking a negotiated solution". Faint signs indicate that even the pro-Eta Herri Batasuna party may be divided over Eta's action. In a rare breaking of ranks, Herri Batasuna's lawyer, Patxi Zabaleta, condemned the killing as "unjustified".
Last week the Supreme Court jailed all 23 leaders of Herri Batasuna for eight years for collaborating with terrorists, prompting their spokesman to warn of "grave and direct consequences".
Yesterday's killing appears to have dashed hopes for an early ceasefire raised when Eta announced a semi-truce last month.
The government last week agreed to transfer 16 Eta prisoners held far from the Basque country to jails nearer home, which partly meets one of Eta's principal demand.
A proposed general strike called by Herri Batasuna for Monday was yesterday called off.