Witnesses said dozens of armoured vehicles took part in the invasion of the Buraij camp in the central Gaza Strip on Sunday.
Earlier, six Palestinians were killed on Saturday during a failed assault in fake Israeli army jeeps at the Erez crossing.
It was an unusual combined attack by three resistance groups, including Hamas, Islamic Jihad and al-Aqsa Martyrs Brigades, a Hamas source said.
Cooperation among the groups is likely to fuel US fears that Israel's threatened unilateral pullback in Gaza could cause anarchy in the area.
The fake army jeeps, complete with wire mesh screens used as protection against Palestinian rock-throwers, was a new tactic in a Palestinian uprising that began in September 2000.
Brigadier-General Gadi Shamni, commander of Israeli forces in northern Gaza, said the assault began when a Palestinian car exploded at the heavily guarded main Israel-Gaza border crossing at Erez.
Hamas said the driver was killed in the bombing. Shamni said no Israelis were hurt.
Soon after, two jeeps painted in Israeli army khaki raced to the scene as if responding to the blast and a Palestinian gunman in the lead vehicle fired on soldiers, who shot him and the driver dead, Shamni said.
The second jeep then exploded near a Palestinian police post about 100m away, killing the driver.
Hospital officials said two other Palestinians, both policemen, were killed and 15 wounded.
The Erez crossing is the gateway
to coveted jobs in Israel
"It's possible the Palestinian (policemen) tried to stop the jeep and the driver blew himself up or something malfunctioned," Shamni said.
Palestinian security sources said Israeli forces had fired at the vehicle, but Shamni denied this.
Palestinian shot dead
The violence at the flashpoint frontier erupted three days after an Israeli missile strike killed three Hamas resistance fighters in Gaza.
The area, like the West Bank, was sealed off by Israel on Thursday in a security alert for the Jewish holiday of Purim.
For thousands of Palestinian labourers Erez, in the northern Gaza Strip, is a gateway to coveted jobs in Israel and in an Israeli-run industrial zone at the crossing.
Earlier on Saturday, Israeli soldiers shot dead a Palestinian in the West Bank city of Tulkarm, an Israeli military source said.
Local residents said he was an unarmed policeman in uniform caught up in a confrontation between soldiers and stone-throwers.
The military source said he was dressed in a camouflage uniform and armed with an assault rifle.