An Israeli air strike aimed at Palestinian militants in Gaza has killed three children standing near the target vehicle.
Witnesses said aircraft fired at least one missile at a car carrying al-Aqsa Martyrs Brigades gunmen in Gaza City.
The occupants managed to leap free but a 7-year-old girl, a 5-year-old boy and a 16-year-old were killed.
Nine other bystanders, most of them minors, were injured.
Israeli Defence Minister Amir Peretz, under pressure from residents of border towns that have been targeted by Gazan rocket crews, yesterday promised new military counter-measures but did not elaborate.
A surge in violence following the deaths of eight Palestinian civilians on a Gaza beach on 9 June has seen militants fire over 130 rockets at Israel.
The desert town of Sderot, in particular, has borne the brunt of such attacks and over 20,000 council staff have threatened strike action to protest against the insecurity.
Since Israel's withdrawal from Gaza last September following a 38-year occupation, Sderot has found itself repeatedly targeted by the notoriously inaccurate devices.
Talks make 'some progress'
Officials said tonight that some progress had been made in crisis talks between Hamas and Fatah.
Hamas, which heads the Palestinian government, and the Fatah party of president Mahmoud Abbas, met late into the night, with the end of a second round of crisis talks due in principle to expire tomorrow.
The focus of talks has been a statehood initiative that implicitly recognises Israel's right to exist by calling for a Palestinian state on land conquered in 1967, an end to attacks in Israel and a national unity government.
Unless the initiative is accepted by all factions, Mr Abbas has said he will put it to a referendum, already set for 26 July.
That threat irritated Hamas, which claims the unprecedented vote amounts to an attempt to overthrow its government.
Officials said a deal may be signed by the end of the week, but that disagreements remain over who would head the unity government of Hamas, Fatah and other factions.
After the Palestinian elections earlier this year, Western countries imposed sanctions after Hamas refused to recognise Israel, renounce violence and accept past peace accords.
The aid embargo has brought the Palestinian Authority to the brink of collapse.
