A Palestinian resistance fighter shot the soldiers early on Tuesday near a road outside the village of Al-Khadir.
Israel Radio confirmed the incident and the measures being taken to catch the assailant.
Aljazeera’s correspondent says three Palestinians have already been arrested.
Occupation forces have closed all gates to the village and are preventing locals from entering or leaving as they perform house to house searches.
An Israeli military source told Aljazeera.net the army was investigating whether the attack was a roadside shooting or the work of a sniper.
There has been no immediate claim of responsibility.
Another attack on the Israeli military was reported in the northern Gaza Strip when an explosive device went off at the Erez crossing.
But there were no reported injuries, Army Radio said.
Yuval Shteinitz, an official in the ruling Likud Party, has already condemned talks with the new Palestinian Prime Minister, Ahmad Quraya, on Israeli radio following the attack.
Shteinitz said it was “very strange” the government was even considering another ceasefire when occupation forces are still attacked and the Palestinian Authority proves itself incapable of disarming resistance groups.
But in Rome on Monday, Israeli Prime Minister Ariel Sharon said he hoped to meet his Palestinian counterpart "in the next few days" to resume talks on implementing a US-backed peace "road map".