Gunfire erupted early Wednesday at an Israel-Gaza checkpoint where Palestinians were about to cross at the beginning of an Islamic pilgrimage to Mecca (search), the Israeli military and Palestinian security said. An armed Palestinian was killed.

Also Wednesday, Palestinian militants (search) fired two homemade rockets into southern Israel, wounding 12 people, rescue workers said.

Palestinian security officials said the exchange of fire took place at the Erez checkpoint as Palestinians were about to cross through on their way to Mecca for the Islamic hajj pilgrimage. Some 400 pilgrims remained stuck at the checkpoint at midmorning.

The military said the incident erupted after a Palestinian set off an explosive charge and threw grenades at an Israeli army officer, who shot and killed him.

Soldiers exchanged fire with armed Palestinians, and three Palestinian police officers were wounded. The military said they were being treated at an Israeli clinic.

The closure of Erez further restricted Palestinian movement in and out of Gaza (search).

The Rafah checkpoint, the main crossing point from southern Gaza to Egypt, was closed last month after Palestinians tunneled under an Israeli army outpost there and blew it up, killing five soldiers. Israel made the Erez crossing available as an alternative, transporting pilgrims to the Egyptian border.

Violence in Gaza has heated up in recent weeks, after a brief lull following the death of Palestinian leader Yasser Arafat in November.

Palestinian militants have attacked Jewish settlements with mortar fire and fired homemade rockets from northern Gaza, prompting deadly Israeli reprisals. Early this week, the army launched an operation in northern Gaza aimed at halting the rocket fire.

Militants managed to fire two more rockets on Wednesday, wounding 12 Israelis, one of them seriously, rescue workers said. No further details were available.

At nightfall Tuesday, Palestinian gunmen attacked an Israeli outpost east of Gaza City. In an exchange of fire, one of the attackers was killed, Palestinian hospital officials said. The military said soldiers returned fire coming from a nearby building.

After Israeli tank shells killed seven Palestinians in response to a mortar barrage on Tuesday, Mahmoud Abbas, the leading candidate in a Palestinian presidential election, issued his harshest denunciation of Israel.

Witnesses and relatives said the seven, all under 18, were working in a strawberry field outside the northern Gaza town of Beit Lahiya when militants fired the mortar rounds, wounding an Israeli. The militants fled, and the tank shells hit the young farmers.

Israel said some of the militants were hit, but Col. Avi Levy, the area commander, apologized for civilian casualties.

Abbas, campaigning in Gaza before the Jan. 9 election, was furious.

"We came to you today, while we are praying for the souls of the martyrs who were killed today by the shells of the Zionist enemy in Beit Lahiya," Abbas told thousands of supporters, using a term for Israel usually employed by Islamic militants.

In response, Israeli Foreign Minister Silvan Shalom broke his government's policy of not criticizing Abbas during the campaign.

"Israel is very concerned about Abu Mazen's recent statements which are very militant ... and the like of which we haven't heard in a long time," he said, referring to Abbas by his nickname.

In Washington, the U.S. State Department responded with strong criticism.

"Obviously, we find such language disturbing," said Rhonda Shore, spokeswoman for the Bureau of Near Eastern Affairs. "Such rhetoric has no place in the process of resuming dialogue and rebuilding trust and confidence between both sides."

Polls show Abbas with a huge lead over his nearest rival, democracy activist Mustafa Barghouti, in the election to replace Yasser Arafat as president of the Palestinian Authority. But analysts say Abbas needs about two-thirds of the vote to be able to claim even part of Arafat's emotional and political following.