Israeli forces clashed with militants in the northern Gaza Strip today, killing two Palestinians, residents and hospital officials said.
Three Israeli soldiers were lightly wounded by Palestinian militants who fired an anti-tank missile at forces operating in the area, the army said.
Hamas claimed responsibility for the attack.
Palestinian hospital officials said a 16-year-old civilian was killed by Israeli troops in the northern Gaza town of Beit Lahiya. The Israeli army said its forces shot at a group of militants but it was unclear whether the 16-year-old was one of them.
Earlier, residents said one militant from the Democratic Front for the Liberation of Palestine was killed by Israeli troops who had taken over a house in the town.
An army spokeswoman said special forces operating in the area opened fire when they were approached by an armed man.
More than a dozen Israeli tanks and armoured vehicles entered the town in an operation the army said was aimed at stopping Palestinian militants from firing rockets into Israel.
The operation comes three days after a rocket fired from Gaza killed a woman in the southern Israeli town of Sderot, prompting right-wing Israeli politicians to call for a major push into the coastal strip.
The new Israeli Minister of Strategic Affairs, Avigdor Lieberman of the right-wing party Yisrael Beitenu, said on Saturday Israel needed to take control of the border between the Gaza Strip and Egypt.
"We have to take back control of the Rafah crossing and the Philadelphi corridor (between Gaza and Egypt)," he said on Israel Radio.
"We have heard about tonnes of weapons and missiles, and hundreds of millions of dollars from Iran being smuggled into Gaza, and that is the fuel that keeps the machine going."
Israeli Prime Minister Ehud Olmert has said Israel would find and kill those responsible for the rocket attacks. But he said the rockets could not be stopped in "one fell swoop", appearing to rule out a massive military push.
Israel quit Gaza last year after more than 38 years of occupation.