Israeli helicopter gunships have killed four members of the militant Palestinian group Hamas in a rocket attack in Gaza City.
Locals say the four men were members of Hamas
An Israeli army spokesman said the main target was Ahmed Shtewe, 24, a senior military commander in Gaza, responsible for planning and executing attacks.
Palestinian sources said he was the leader of a special unit which was involved in the firing of homemade rockets and mortars against Israeli targets.
Israel has vowed to eliminate leaders of Palestinian groups involved in attacks on its citizens, with its army chief saying that any Hamas members were potential targets for "liquidation".
On Thursday, helicopters attacked the car of senior Hamas leader Ismail Abu Shanab in Gaza, killing him and two others, days after a suicide bomb attack left 21 dead in Jerusalem.
A Palestinian minister said Sunday's attack proved that Israel was not interested in trying to resurrect the peace process or any kind of ceasefire.
Three missiles were fired into the city's seafront where the four men killed had been sitting for about half an hour.
"I was about to enter my house with my wife, when suddenly a huge explosion shook the ground under my feet," said Shadi Wassi, a local resident.
"When I looked back, I saw a big flame burning the trees, then another two huge explosions hit the area."
The victims were said to be armed and wearing combat fatigues.
The attack is believed to have taken place just 100 metres from the Gaza office of Palestinian security chief Mohammed Dahlan.
Palestinian officials said the raid would undermine a planned Palestinian security clampdown that began on Saturday with moves against arms smugglers.
And it casts fresh doubt on the already shaky US-backed peace plan, known as the roadmap.
"This aims to sabotage the efforts that began last night," Palestinian lawmaker Saeb Erakat told the Associated Press news agency.
"It's very obvious that the Israeli Government is acting as if the Palestinian Authority is something from the past."
Israeli security sources in Jerusalem said the men were responsible for recent mortar attacks on Israeli targets near Gaza.
Israel's army chief, Lieutenant General Moshe Yaalon,
said earlier on Sunday that all members of Hamas were "potential targets for liquidation".
"If, at the end of the day, the Palestinian Authority [PA]
doesn't move against them, we will have to do so," he said on a day when divisions surfaced within the PA over control of security.
PA leader Yasser Arafat is reported to be pushing for an old comrade, Nasser Yousef, to take overall charge of security matters in what appears to be a direct challenge to the current security chief, Mr Dahlan.
The promotion of Mr Yousef is seen as directly undermining Prime Minister Mahmoud Abbas.
The BBC's Chris Morris in Jerusalem said this latest attack proves again that Israel has the ability to find and kill specific individuals.
But he said it would also increase the determination among Hamas militants to take their revenge against Israeli targets.