Israeli aircraft fired missiles at two cars in Gaza packed with rockets on Thursday, killing one Islamic Jihad militant and critically wounding another, the Israeli army and Palestinian officials said.

The militants were on their way to fire a barrage of homemade rockets at Israeli targets, the military said. The militants belonged to a cell that was especially active in firing rockets, it added. One of the two cars targeted was hit, the army said.

Pillars of black and white smoke billowed from the destroyed vehicle as rescue workers removed burned and dismembered bodies from the car.

Israel has pledged to end the rocket fire from Gaza into Israel, but is reluctant to launch an invasion into the coastal area it withdrew from in August. The homemade rockets are highly inaccurate, but at times have killed people and damaged buildings.

The new Hamas-led government has said it will not arrest the militants launching the rockets or take other steps to halt the fire.

Hamas' stringent stance has added to Israel's ire over the Islamic group's rule. Israel has declared the new Hamas-led Palestinian Authority an enemy entity and cut off all political and financial ties, withholding $55 million in monthly tax revenues it collects for the Palestinians.

The United States and other Western countries have also slapped economic sanctions on the Palestinians, demanding Hamas recognize Israel, accept past Israeli-Palestinian peace deals and renounce violence.

Hamas has so far rejected the demands, but could fold under the financial pressure. It has been unable to pay salaries to 165,000 government employees as a result of the sanctions.

Islamic Jihad vowed to take revenge for Thursday's missile strike.

"God willing our reprisal is coming and it is going to be like air shaking," said spokesman Abu Ahmad. "We are going to shake the air under their feet. They had experienced us in Tel Aviv and more is coming."

Islamic Jihad, a small group with ties to Iran and Syria, claimed responsibility for last week's suicide bombing in Tel Aviv that killed nine and wounded dozens.

During more than five years of fighting, Israel has killed dozens of militants in targeted airstrikes. The attacks also have killed or wounded dozens of civilians.