Palestinian officials have shown television cameras the mangled wreckage that they say is all that remains of a car targeted by an Israeli airstrike.
A spokesperson in the Gaza Strip says the night-time attack in Rafah killed two men in charge of supervising tunnels leading into nearby Egypt.
A third has been critically injured.
The Israeli military claims it targeted what it described as “terror operatives” involved in smuggling weapons used to launch attacks.
But Hamas insists the men were employed to supervise the transfer of goods through tunnels dug between Gaza and Egypt.
Those who died are said to have been members of a border patrol unit.