Egyptian forces struck tunnels that connect Gaza and Egypt on Saturday, according to local residents in Rafah.
Reuters video showed explosions in the area followed by smoke clouds in Rafah on the border between Gaza and Egypt. The strike explosion took place at around sunset.
About 80 percent of tunnels used to smuggle goods and arms into the Gaza Strip from Egypt are no longer functioning due to a crackdown by the Egyptian military after it ousted President Mohamed Morsi, a United Nations official said in July.
Cairo moved to destroy the tunnels after militants in the Egyptian Sinai desert killed 16 of its soldiers a year ago. Egypt said some of the gunmen had slipped into Sinai from nearby Gaza, an accusation denied by Hamas, who controls the strip.
Gaza relies on the network of tunnels for vital goods including fuel, cement and food.
Hamas, which taxes much of the traffic through the underground passages, has been hit hard by the losses. Ordinary Palestinians, many of them dependent on U.N. aid handouts, have seen prices for staple goods skyrocket.
Israel still maintains strict control of all imports into Gaza to prevent arms reaching Hamas, which refuses to recognize the Jewish state and has often clashed with it. Under international accords, merchandise cannot be imported via Egypt.