The militants had been attempting to plant a bomb near the town of Khan Younis for use against Israeli patrols when they came under fire.
Palestinian militants continue to attack Israeli patrols and fire rockets from the Gaza Strip into southern Israel despite Egypt's attempts to broker a ceasefire between Tel Aviv and the Hamas movement, which seized control of the enclave from the pro-presidential Fatah movement in June last year.
Israel closed off Gaza border crossings in January this year and imposed restrictions on essential supplies in an attempt to pressure the radical Islamic group Hamas to halt rocket attacks against Israeli border towns. It also launched an attack on the Gaza Strip in early March, killing 120 Palestinians, many of them women and children.
