Egypt closed the border between Sinai and the Gaza Strip as clashes between its government security forces and protesters backing deposed President Mohamed Morsi continued for a second day.
Islamists attacked Egyptian military posts in the Sinai, killing at least one on the Gaza border.
For years, the tunnel economy in the Gaza Strip has flourished. An estimated 1,000 tunnels were burrowed underground, connecting the southern Gaza town of Rafah and the Egyptian–controlled Sinai Peninsula. Everything from new cars (cut up into pieces for shipping) to cigarettes to weapons to drugs came through the tunnels.
Egypt reportedly is planning to introduce tanks in the Sinai for the first time since the 1973 war with Israel.
Gunmen fired shots towards a police station in the main administrative center of Egypt's North Sinai on Thursday, underscoring lawlessness in the desert region bordering Israel as a Egyptian military offensive there entered its second day.
An Israeli air strike killed the leader of an armed Palestinian faction, a top lieutenant and three other members in the southern Gaza Strip Thursday, the group said, hours after Israel blamed gunmen from the territory for cross-border attacks.
Hamas leader Ismail Haniyeh urged Gazans on Tuesday to refrain from breaching Egypt's security in order to maintain the Rafah border crossing open, French news agency AFP reported.
Israeli officials said Egypt has agreed to hold off on opening its border with Gaza -- a key Hamas demand -- until there is progress in talks on Shalit's return. The IDF is expected to be ready for a last-resort invasion of Gaza, if the cease-fire fails.