The Israeli army responded with tank fire at an observation post for Islamic Jihad's military wing Saraya al-Quds.
Sirens were sounded as an Israeli home was reportedly hit by a rocket fired from Gaza.
Hamas will not allow Israel to "impose any new equation on the ground or export its internal crises and the corruption cases of its leaders by escalating the aggression on our people", Abd al Latif Kanou, a spokesman for the terror group said.
IDF fighter planes struck Hamas terrorist targets in Gaza in response to an earlier attack.More news: Indian woman arrested for posing as man, marrying women for dowry
In total, the IDF attacked six targets belonging to Hamas. The rocket fired from the Gaza Strip exploded in an open area, causing no casualties or damage.
Two Palestinians were injured in the raids, Palestinian medical sources said.
Prime Minister Benjamin Netanyahu at a security conference in Munich called the Gaza border incident "very serious" and pledged to "respond appropriately".
There was no immediate claim of responsibility for the explosion, but army spokesman Jonathan Conricus blamed the Islamist Palestinian movement Hamas for the blast, in remarks on Twitter.More news: Alpine skiing-What to look out for in the women's super-G
The IDF "sees with gravity attempts by Hamas to use supposedly spontaneous popular demonstrations to turn the border region into an arena of conflict and to execute terrorist operations", an army statement said.
Tensions between the Palestinians and Israel have been high since US President Donald Trump recognized Jerusalem as the capital of the Jewish state in December.
In response, the IDF said one of its tanks struck terrorist objectives in the southern Gaza Strip.
Netanyahu will visit the White House next month, a senior U.S. administration official told AFP on Friday, February 16.More news: Apple's new spaceship campus has one flaw
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