Israel's Army expressed sadness Wednesday for the killing of at least 10 Palestinians in southern Gaza. All the dead are reported to be under 18. More than 50 were wounded after an Israeli tank and a helicopter fired towards a crowd of Palestinian demonstrators in Rafah. The death toll has risen to more than 30 since Israel launched a military incursion in the area to destroy weapons smuggling tunnels and arrest Palestinian militants.

The Israeli Army released a statement Wednesday expressing deep sorrow over the loss of civilian lives.

The statement says that the incident occurred as a crowd of demonstrators, organized by the Palestinian Authority, left central Rafah and marched towards Israeli forces stationed on the outskirts of the town.

The Israeli Army says that as the demonstrators, with Palestinian gunmen among them, drew close to the Israeli troops, a single helicopter missile was fired as a warning into an open area.

Flares were also fired from a helicopter but when the crowd kept marching towards them, the Israeli troops fired a machine gun and four tank shells at the wall of an abandoned structure.

The Israeli army statement says it is possible that the casualties were a result of the tank fire and investigations are continuing.

The statement was released after Palestinian officials expressed their outrage at the incident, calling it a massacre and a war crime.

Palestinian Cabinet Minister Ghassan Khatib gave this reaction. "This most recent and most vicious Israeli crime of shelling by missiles a peaceful demonstration is an indicator of the real intentions of the Israeli Army which is simply trying to effect the maximum casualties of the Palestinian people regardless of whether they are civilians are otherwise," he said.

But Israeli Prime Minister, Ariel Sharon's spokesman, Raanan Gissin, insists the Israeli army did not intentionally fire on the Palestinian demonstrators. "Israel has no policy whatsoever of shooting at the crowds of demonstrators, willfully and directly," he said. "Therefore we are conducting a very thorough investigation, almost like a police investigation, to find out what happened there."

Before the incident, Israeli officials said the operation in Rafah would continue until it destroyed all tunnels used to smuggle weapons and explosives from neighboring Egypt.

But some Israeli commentators say that the incident may force Israel to withdraw from the area sooner rather than later, for fear of drawing more condemnation from the international community.