Israeli aircraft struck a Palestinian rocket squad in the Gaza Strip on Sunday, killing two militants as the military activated a new defense system to shoot down incoming rockets.
Islamic Jihad, a militant group that frequently attacks Israel, confirmed two members were killed in the airstrike, while a third was critically wounded. The group did not specify whether they were in the process of launching rockets.
Gaza militants, including Islamic Jihad and the territory's Hamas rulers, had said over the weekend that they would halt their fire if Israel did. It was not clear whether they were reneging on that pledge or whether the air strike hit a rogue group of militants ignoring the cease-fire overture.
A spokesman for Gaza's Hamas-run interior ministry, Ihab Ghussein, accused Israel of seeking to perpetuate the violence. But Hamas government spokesman Taher Nunu urged all militant factions to halt their fire as agreed.
Israeli Prime Minister Benjamin Netanyahu said Israel had "no interest" in escalating things.
"But we won't hesitate to employ the might of the military against those who would attack our citizens," Netanyahu added in remarks at the start of his weekly Cabinet meeting.
Weeks of stepped-up rocket and mortar attacks have drawn fears of renewed war and led to new calls in Israel for the military to deploy the $200 million Iron Dome anti-rocket system.
The Israeli military said the system began operating on Sunday near Beersheba, southern Israel's largest city. A second anti-missile battery will be deployed in another large southern city, Ashdod, the military added, without specifying an exact date.
The Israeli-developed system uses cameras and radar to track incoming rockets and is supposed to shoot them down within seconds of their launch. It has functioned properly in a series of tests.
Brig. Gen. Doron Gavish, commander of the air defense corps in the Israeli air force, told reporters that the Iron Dome was to have been deployed later in the year, but was put into operation earlier because of the new rocket attacks from Gaza.
He said the system would undergo months of trials even after its deployment, but wouldn't say how many Iron Dome batteries would be deployed or give any other operational details.
Security officials said privately that public pressure was a factor in the early deployment of the system, which is still being fine-tuned. They spoke on condition of anonymity because they were not authorized to discuss operational decisions.
Netanyahu said at the Cabinet meeting that he "didn't want to create the illusion" that the Iron Dome would offer Israel 100 percent protection from rocket attacks.
"The Iron Dome system is still in an experimental stage and at any rate, we cannot deploy batteries that can protect every house, every school, every base and every facility."
The renewed hostilities have fed concerns of another large-scale Israeli military operation against Gaza militants. In December 2008, Israel invaded Gaza in response to years of rocket and mortar barrages on its southern communities, killing 1,400 Palestinians, including more than 900 civilians, and causing widespread destruction.
Thirteen Israelis also died.
Israel says that Hamas, which suffered heavy losses in the fighting, has largely recovered from the fighting and restocked its arsenal with more powerful weapons.
AP correspondent Amy Teibel contributed to this report from Jerusalem, and correspondent Ibrahim Barzak contributed from Gaza City, Gaza Strip.