Israel has carried out an air attack in the Gaza Strip and launched an incursion with tanks and bulldozers across the border.
Palestinian sources say there has been fighting near Khan Younis in southern Gaza, with people fleeing their homes.
The incursion follows a bomb attack which killed one Israeli soldier and wounded three near the Gaza border.
It is the worst violence since Israel's offensive against Hamas in Gaza ended with both sides declaring ceasefires.
An Israeli soldier was killed by an explosive device planted on its side of the border near the Kissufim crossing, prompting troops to opened fire into Gaza.
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