Three Hamas militants have been killed by Israeli troops during a gun battle in the Gaza Strip.  Israel's prime minister says his country's military might expand operations in the Gaza Strip to counter Palestinian militants, who continue to launch rockets into Israeli territory. 

The militants were killed near Khouza - a village in the southern Gaza Strip, near the Khan Younis refugee camp which is next to the Israeli border.  Several other Palestinians were reported wounded in the fighting.

Questioned about Israel's operations in Gaza during a closed parliament committee session, Monday, Israeli Prime Minister Ehud Olmert said Israel could step up operations in Gaza.  However, he says he has no intention of re-occupying the territory from which it disengaged last year.   Major Avital Leibovich - a spokeswoman for the Israeli defense forces - says military operations in Gaza have two overall objectives.

"We basically see a serious threat considering the civilian population in the vicinity of the southern part of Israel.  The Qassam rockets are being fired on a daily basis," Leibovich says. "This, together with the smuggling of the weapons, causes a serious threat for us and that is why we are acting the way we are acting.  Basically, we are talking about the strengthening the operations in the southern Gaza Strip currently in order to try and prevent this infrastructure from operating against us."

Palestinian Prime Minister Ismail Haniyeh, a leading Hamas militant, has condemned the latest Israeli military incursion in Gaza, calling on the international community to halt what he describes as "Israeli aggression." 

Violence and chaos is getting worse in Gaza.  Late Monday, Palestinian militants released a Spanish aid worker kidnapped earlier in the day.  Last week, a Spanish photographer working for the Associated Press was kidnapped and held for less than a day, becoming just the latest in a number of foreigners kidnapped by different militant groups.

Israeli forces have killed about 250 Palestinians, about half of them civilians since launching a military offensive in Gaza in late June, after Palestinian militants kidnapped an Israeli soldier and stepped up rocket attacks against towns in southern Israel. Two Israeli soldiers have been killed in the ongoing operation. 

Meanwhile, Israeli warplanes have flown over southern Lebanon including the southern suburbs of Beirut - a stronghold of the militant group Hezbollah.  Tuesday's flights took place just hours after United Nations Middle East envoy Terje Roed-Larson told a session of the Security Council that arms smuggling from Syria into Lebanon is continuing. 

U.N. officials have called on Israel to halt the overflights, saying they are a violation of the U.N.-brokered ceasefire that ended fighting between Israel and Hezbollah. Israeli officials say the overflights are for intelligence gathering and are necessary to monitor what Israel describes Hezbollah and Lebanese violations of the ceasefire.