An Israeli army spokesman said the incursion in central Gaza around the Mughazi refugee camp, and another in the northern part of the territory that was used to fire rockets on Israel, had ended and troops were back in Israel.

Of the 11 Palestinian fighters killed, six belonged to the armed wing of Hamas, the Islamist movement blacklisted as a terrorist organisation in the West and which seized control of the Gaza Strip last month.

More than 25 Palestinians were wounded during the incursion, including five seriously, local medical sources said.

Two Israeli soldiers were also wounded in the central Gaza Strip operation, which saw around 100 troops, backed by tanks and helicopters, advance through the territory on foot, witnesses said.

Six houses were damaged by Israeli fire and a former Palestinian security station completely destroyed in fighting around Mughazi where army bulldozers ripped up two hectares (five acres) of farm land, local witnesses said.

Another five hectares of farm land were bulldozed in the north, they said.

Although Israel has vowed to bolster Palestinian president Mahmud Abbas and his new Western-backed emergency government based in the occupied West Bank, it has sworn to continue attacks on militants.

Abbas and Israeli Prime Minister Ehud Olmert are expected to meet this month in the West Bank oasis town of Jericho, a senior official in Olmert's office told AFP, for talks cancelled during the crisis that saw Hamas seize Gaza.

Israeli and Palestinian officials also began security discussions this week, which Israel would like to continue regularly in Ramallah and Jerusalem with a view to reforming a united Palestinian security force, the source said.