Two Israeli soldiers have been killed and there are reports of two Palestinian fatalities on the border with Gaza.
Eyewitnesses say a rocket was fired at an Israeli patrol from the Palestinian town of Khan Younis, and a firefight ensued. Israeli helicopters and tanks returned fire. Other sources say the patrol entered Gaza and was hit by a bomb, followed by a fusillade.
Hamas, which controls the Gaza strip, has claimed responsibility for the action, which it called a “defensive” measure. Other sources say the firefight followed an attempt to capture Israeli soldiers.
Earlier in the day a large explosion was reported at Kissoufim, a former border crossing into Israel, and Israeli tank fire seriously injured one man.
Gaza has been tense all day. Demonstrations were held to call on Arab leaders meeting in Libya at the weekend to protect Jerusalem, where a number of new Israeli homes have recently been announced.
But Islam’s third holiest place, the Al Aqsa mosque, was calm for Friday prayers, the first for a month Israel has allowed without any age restriction on worshippers.