Israeli airstrikes killed two militants and a schoolboy as Palestinian rockets continued to bombard Israel, in escalating fighting that has defied inter-national truce efforts.

The cross-border violence, sparked by Israel's killing of a top militant leader on Friday, has been the worst exchange of fire between Israel and the Hamas-ruled territory in months.

The fighting so far has killed 21 Gazans, including 18 militants, seriously wounded two Israelis, and disrupted the lives of one million Israelis living within the range of Gaza rockets.

The Israeli military said it carried out nine air attacks against rocket-launching sites and a weapons storage facility.

Islamic Jihad said two of its militants were killed in two separate raids.

A 16-year-old boy wearing a school uniform was killed when a group of five civilians was struck in another attack, Gaza health official Adham Abu Salmia said.

More than 20 Palestinians, including several children, were wounded in a separate strike in Gaza City, Mr Abu Salmia said.

Chief Israeli military spokesman Yoav Mordechai said the raid targeted munitions stored in a residential building, and were a response to continued rocket fire.

Schools in the area were closed for a second day to avoid casualties after a rocket struck the yard of one of the empty schools.