Israel launched a missile strike on Palestinian security headquarters in central Gaza tonight just hours after Palestinians fired mortar bombs into an Israeli town.
A military official said the army was striking Palestinian security targets from the sky. The official said the attack was under way but gave no further details.
At least two Palestinians were wounded in the attack on the headquarters of Force 17, an elite security unit, in the Deir al-Balah refugee camp, a police officer at the scene told Reuters.Three missiles hit the headquarters, he said.
The mortar bombs that landed on the town of Sderot had penetrated deeper into Israel then any others since the start of the Palestinian uprising nearly seven months ago.
The desert town is about five kilometres (three miles) from Gaza and just down the road from Prime Minister Ariel Sharon's ranch in southern Israel.
Sharon's spokesman, Mr Raanan Gissin, vowed earlier that Israel would retaliate for the mortar bomb attack. He said the Israeli leader had met top security officials and would seek a way to bring about the cessation to such hostilities.
Mr Gissin said the Palestinian Authority was directly responsible for the mortar bomb attack but a senior Palestinian official said Israel was to blame.
The Palestinian Authority is not responsible for the firing of mortars, Palestinian Information Minister Yasser Abed Rabbo told reporters.
"Sharon is responsible for the demolition of civilians' houses in Rafah and Khan Younis and he provoked such retaliation by the people", he said, referring to Israeli assaults in the past week on Palestinian-ruled areas ofGaza.