At least seven Palestinians and one Israeli soldier have been killed as violence spread across the Gaza Strip.
Israeli forces backed by tanks and attack helicopters swept into the Palestinian town of Beit Hanoun in the northern Gaza Strip.
The operation followed rocket attacks from Beit Hanoun into the nearby Israeli town of Sderot.
The troops encountered fierce resistance, as Palestinians tried to stop their advance using automatic rifle fire, anti-tank weapons and explosives.
Throughout the day, stone-throwing Palestinian youths also battled the troops.
Israeli bulldozers demolished four homes during the operation, including one belonging to a member of the Islamic Jihad, an organization that has carried out frequent suicide bombings and other terrorist attacks.
The family of the man, who was killed by Israeli soldiers on Friday, initially refused to abandon the house and opened fire on the troops.
An Israeli army spokesman said the operation was another attempt to stop the firing of Kassam rockets from the Gaza Strip on Israeli towns in the Negev desert.
So far, the efforts have not succeeded. Following the latest incursion, another Kassam rocket landed in Sderot. There were no reports of casualties.
Violence also raged in other parts of the Gaza Strip.
One Israeli soldier was shot and killed when Palestinian snipers opened fire on an Israeli army position in the southern part of the territory.
An armed Palestinian was also shot dead by Israeli troops as he approached the Jewish settlement of Netzarim in the Gaza Strip.
