Mohammed Nazzal, a Hamas official, told Al Jazeera: "The blood of Siam will be a curse on the Zionist entity."
Siam is considered to be among Hamas's top five leaders in Gaza.
As interior minister in Hamas's government in Gaza, he had been in charge of 13,000 Hamas police and security men, many of whom are actively involved in fighting Israel.
The Israeli military confirmed it carried out the raid.
"In a joint operation of the IDF [Israeli Defence Forces] and the Shin Beth [internal security] a short while ago, jets attacked a building in Gaza while Said Siam was inside with his brother, Iyad, and a third person," an army spokeswoman said.
"We identified hitting the target."
|Siam became the interior minister in 2006 [AFP]
A deputy from a Gaza constituency, Siam was named Hamas interior minister in 2006 after Hamas won a majority in parliamentary elections.
Born in the Beach refugee camp in Gaza City in 1959, he was a teacher until 2003, during which time he was also active in politics.
He was arrested four times during the first intifada from 1987 to 1993.
He was expelled by Israel in 1992 to southern Lebanon, and upon his return was arrested by Palestinian security forces.
Siam was close to Sheikh Ahmed Yassin, the founder and spiritual leader of Hamas who was also killed by an Israeli air strike, and Hamas political leader Khaled Meshaal, whom he accompanied on a visit to Moscow.
Before Thursday's assassination, the most senior Hamas figure Israel had killed since launching its deadly offensive on Gaza was Nizar Rayyan, who was killed along with his four wives and 13 children in an Israeli air attack on his house.