Six civilians were also wounded in Monday's clash, including two ambulance staff and two radio reporters.

The Israeli army confirmed the incident and said that troops had spotted militants preparing to launch rockets at Israeli targets.

"The force spotted the militants and a gun battle followed in which an air force helicopter was also involved," a Israeli army spokeswoman said.

There were no casualties among the Israeli force, she added.

The area where the clash took place is a frequent flashpoint.

Israel withdrew from the Gaza Strip last August after 38 years of occupation.

In violence earlier on Monday, Israeli soldiers shot dead a Palestinian fighter along the Gaza-Israel border, Palestinian and Israeli officials said.

Tension has been running high since Friday, when an Islamic Jihad commander was killed in an explosion in south Lebanon.

The resistance group blamed Israel and threatened revenge, although Israel denied involvement.