Defense Minister Avigdor Liberman said that the construction of the barrier constitutes an additional blow to Hamas' capabilities: "This is the only barrier of its kind in the world, which will effectively block the possibility of infiltrating into Israel by sea", he said.
A group of organizers in the enclave say they will try to help Gazans get through the blockade by boat this week following weeks of brutal massacre of unarmed Palestinian protesters by Israeli live fire along the border of the besieged sliver with the occupied territories.
On Saturday morning, Israeli soldiers spotted four Palestinians who crossed the security fence into Israel from the southern Gaza Strip, the Times of Israel reported.
A statement from the armed wing of Islamic Jihad, the Al-Quds Brigades, claimed the two as members.
Two of those killed were identified as 25-year-old Hussein al-Amour, 28-year-old Abdul Haleem al-Naqa, according to the Palestinian health ministry.
Islamic Jihad operates with a measure of independence from Hamas, the Islamist group that has controlled Gaza since 2007 and fought three wars against Israel.
GETTYMore than 100 Palestinians were killed and more than 13,000 injured during border protests
Israel's military confirmed the strike, saying it targeted an observation post in response to a bomb that had been placed next to the border fence overnight.
Israel already maintains a naval blockade on the Gaza Strip.
Over a hundred Palestinians have been killed in the rolling protests and clashes, mostly from Israeli gunfire and thousands more injured.
There have been no Israeli casualties along the Gaza frontier, but Israel has reported extensive damage to farmland on its side of the border from firebomb-bearing kites flown over from Gaza.
The Defense Ministry has started construction on an underwater barrier, which will stretch from the southern Israeli community of Zikim out into the Mediterranean to stave off Hamas infiltration by sea.
According to Gaza medical officials, more than 115 Palestinians have so far lost their lives by Israeli fire since the border rallies began in late March.More news: How Retro, Samsung & Apple Back In Court Over Galaxy 2