Smoke plumes could be seen rising from Gaza City following the Israeli raids on Wednesday night.
Over the past four months, 158 Palestinians have been killed by Israeli fire, including at least 120 in the protests near the fence and others in Israeli air strikes and other incidents elsewhere in Gaza, according to the Gaza Health Ministry and a local rights group.
TRT World's Mohammad Mansour reports from Gaza.
Sirens wailed in southern Israel warning of incoming projectiles from Gaza and Israeli media reported two people were lightly injured from shrapnel in the border town of Sderot.
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In a statement, the army claimed that its tanks hit a Hamas position in eastern Gaza in response to earlier gunfire from the strip targeting Israeli construction vehicles.
Palestinian reports said the two were killed when IDF artillery struck a graduation ceremony of al-Qassam members at a Hamas base Askelan, northern Gaza, where senior Hamas figures were in attendance.
"As of now, approximately 70 rocket launches were identified from the Gaza Strip at Israeli territory", the army said in a statement.
Human rights groups have accused Israeli troops of using excessive force at the protests, but the military said they only opened fire in self-defence or on people trying to infiltrate its territory.
Parts of the town have been closed off and police bomb disposal units were at the scene of the strikes, a spokesman for the force said.
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The United Nations condemned the Hamas rocket fire.
An Israeli minister said his government has rejected an European Union plan to link the Gaza Strip with the West Bank, according to Israeli media on Wednesday.
The push for a long-term ceasefire agreement follows months of clashes between Israel and Hamas, marked by a surge in cross-border arson attacks, rocket fire, and violent clashes which brought the sides to the brink of a full-scale war in two separate military flare-ups in July.
The exchange came amid continued attempts by Egypt to broker a broad cease-fire deal between Israel and Hamas.
One Israeli soldier has been shot dead by a Palestinian sniper.
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A truce between Hamas and Israel will be officially unveiled by the end of August, according to Turkey's official news agency Anadolu, quoting a Hamas source.