JERUSALEM, Aug 27 (Reuters) - Thousands of Israelis protested high living costs on Saturday in Tel Aviv, but the rally failed to attract the huge masses that took to the streets in past weeks, a sign that security concerns may have trumped the call for social change.

A grassroots movement demanding far-reaching economic reforms swept through Israel this summer, peaking on Aug. 6 when a quarter-million people marched through Tel Aviv. The protests catapulted the economy onto the political agenda.

Prime Minister Benjamin Netanyahu, under pressure, has since passed reforms in the housing market and formed a committee to examine broader changes that would ease the financial burden on the middle class.

But the country's focus returned to matters of security last week when gunmen infiltrated into southern Israel and carried out a series of attacks on vehicles traveling on a quiet desert road, killing eight people.

The attacks sparked a round of violence that cost the lives of more than 20 people, including Israelis, Egyptians and Palestinians in the Gaza Strip.

With much of southern Israel being pounded by rocket fire, leaders of the economic protest canceled events last week.

Since reports of a ceasefire on Friday, after an earlier truce did not last, the cross-border violence has abated.

As long as there are people in the street, the protest still exists, said Daphni Leef, one of the protest leaders, in a television interview at the start of the rally.

Israeli media estimated several thousand people gathered in Tel Aviv, with a much smaller crowd for a similar protest in Jerusalem.

Commentators pointed to other factors that may have affected the smaller turn-out, including that it was a popular holiday weekend before the start of the school year and what they said could be a rift among the protest leaders. (Reporting by Ari Rabinovitch, editing by Rosalind Russell)