Two Palestinians and two Israeli soldiers have been killed in a clash east of the Gaza Strip town of Khan Younis.
The military said an officer and a soldier have been killed and two soldiers were injured.
Hamas confirmed the attack, saying Israeli soldiers are firing artillery and tank rounds.
"An Israeli army force raided 500 meters (yards) into Palestinian territory, and was confronted by our gunmen," said Abu Obeida, spokesman for the Hamas armed wing. "This was our work, but was carried out for defense."
Israel killed up to 1500 Palestinians in its last Gaza offensive, and faces a UN report that accused it of war crimes.
Muawiya Hassanein, director of ambulance and emergency services in Gaza, confirmed that two were killed. Palestinian news agency quoted Hassanein as saying, ambulances were dispatched to the area to evacuate victims, but Israeli forces denied them access.
PHOTO CAPTION
Israeli soldiers stand near the border with the northern Gaza Strip near Kibbutz Nirim, March 26, 2010.
Agencies