Three members of Hamas's armed wing, the Izz al-Din al-Qassam Brigades, have been killed in an Israeli attack on the Gaza Strip, Palestinian officials say.
Health officials said at least four other Palestinians were wounded on Tuesday in separate Israeli air raids.
The Israeli military said it targeted fighters who had fired mortar rounds across the border.
Hamas said 16 mortar shells were fired towards an Israeli-controlled border crossing in retaliation for the killings.
Sami Abu Zuhri, a Hamas spokesman said Israel's military action "clearly indicates that Israel [is] not interested in achieving calm."
"Therefore they must be ready to pay the price," he told the Associated Press news agency.
The attacks occurred east of the town of Jebaliya, in northern Gaza.
Egypt has been trying to broker a truce to end violence on the Israel-Gaza border.
The deaths on Tuesday came as Ehud Olmert, Israel's prime minister, was to hold talks with senior ministers to discuss a possible large-scale military assault on Gaza to try to halt rocket attacks from the Palestinian territory.
Soldier letter
A larger group of cabinet ministers with security responsibilities is to hold further talks on Wednesday.
Meanwhile, the parents of Corporal Gilad Shalit, an Israeli soldier captured two years ago, received a letter from him late on Monday.
Noam Shalit, the soldier's father, said on Tuesday that his son pleaded for his life and appealed to his government not to abandon him.
Shalit has not been seen since a cross-border raid in June 2006.
Israeli media speculated that the relay of the letter suggested the solider may be released and Israeli officials may deter from launching a Gaza invasion.
But Amos Gilad, a senior defense ministry official, told Israel's Army Radio that he saw no connection between the release of the letter and the Israeli leadership's scheduled meetings on Gaza.
Hamas will this week mark the first anniversary of its takeover of the Gaza strip from security forces affiliated with Mahmoud Abbas, the Palestinian president.
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3 Hamas members killed
Al-Jazeera