Israel has launched fresh strikes on Gaza, with one Palestinian militant killed and two hurt in a missile attack near Gaza City.
Israel's PM says the Gaza operation will continue
The Israeli army said the group was planning to launch rockets into Israel.
The strikes came after Israeli Prime Minister Ehud Olmert vowed the army's Gaza incursion - launched to free a captured soldier - would continue.
Scores of Palestinians have died in the campaign, which has also battered Gaza's infrastructure.
Palestinian security sources said the group struck by the Israeli missile near Gaza City included men from several militant factions, including Hamas, which leads the Palestinian government.
Other Israeli strikes, on Sunday, targeted a building which the Israeli military said was being used as a weapons depot by the militant group Islamic Jihad.
Palestinian sources said at least three militants were also wounded in an Israeli air strike near the Karni border crossing. At least one Israeli was injured in one of two Palestinian rocket strikes on Israel.
The strikes came hours after Mr Olmert rejected calls from Hamas for a ceasefire.
"This is a war that cannot be on a timetable," he said.
Mr Olmert told ministers Israel's offensive would continue for as long as it took to secure the release of 19-year-old Cpl Gilad Shalit, captured two weeks ago, and stop cross-border rocket attacks.
"There is no intention to reoccupy Gaza in order to stay there, but if certain operations are needed they will be carried out," he said.
Israeli forces withdrew from northern Gaza on Saturday, but remain east of Gaza City and in the south of the Gaza Strip.
Israel's southern region commander, Gen Yoav Galant, hinted that Israel's operations could continue for weeks.
Hamas says Cpl Shalit is alive and being well-treated.