Four Palestinians, including a senior Hamas militant, have been killed in clashes with Israeli troops in the southern Gaza Strip and the West Bank.
Mourners carry the body of woman killed by Israeli troops
Witnesses and Israeli military sources said soldiers opened fire on a group of militants in Rafah as they tried to plant a bomb in a building being used as a temporary base by the Israelis.
One shell hit the bomb itself, killing a senior Hamas member, another militant and his sister-in-law who was apparently helping the wounded, Palestinian medical sources said.
The dead militant was named as Tareq Abu al-Hussain, 39, a well-known local field commander, Israeli media reported.
Ten other Palestinians were wounded.
In the West Bank town of Tulkarem, a 17-year-old was shot dead when Israeli troops opened fire on a crowd throwing stones and petrol bombs.
Five other Palestinians were wounded.
Later on Saturday, thousands gathered for the funerals of Tareq Abu al-Hussain and the two others killed in Gaza.
Hamas militants fired guns into the air and vowed revenge.
Reuters news agency, which also received a statement from Hamas pledging to avenge the deaths, said the militants chanted: "Our reaction will make Tel Aviv shudder. All our bodies are ticking bombs."
Dozens of Israeli troops, backed by tanks and helicopter gunships, began operating in the Rafah area more than a week ago.
Israel says the raids are a result of intelligence suggesting Palestinian militants were seeking to smuggle shoulder-fired missiles from Egypt that could be used against tanks, helicopters and fighter jets.
It says it has found three tunnels which could be used for smuggling in weapons.
Thousands gathered at the militant's funeral
But the Chief Palestinian Negotiator, Saeb Erekat, has said Israel is getting set to re-occupy the Gaza Strip.
"It's a major escalation, a very dangerous escalation," he said. "We believe this is only the beginning for what is to come to the Gaza Strip: this is the beginning of the reoccupation of the Gaza Strip as a whole.
"This is consistent with the Israeli Government's end-game - destroying the peace process, destroying the Palestinian Authority, and resuming full occupation."
At least eight Palestinians were killed during raids last week, including two children.
Last weekend the United Nations estimated that more than 1,200 Palestinians were also left homeless after Israeli troops demolished dozens of homes in the Rafah refugee camp.
The Israeli army said it only targeted "several" buildings used by Palestinian militants.
Last Wednesday, three US diplomats were killed after their convoy was hit by a massive bomb blast near the village of Beit Hanoun, about one kilometre inside the Gaza Strip.
Palestinian police have since arrested several suspected militants in connection with the bombing, but it is still not clear who was responsible.