Shafaq News/ Israeli soldiers backed by helicopters killed at least two gunmen who crossed the border from Lebanon on Monday, the military said, in a sign of a possible new front opening as Israel's forces battled Palestinian Hamas militants in Gaza.

A Hezbollah official said the group had not mounted any operation into Israel and officials from Hamas and Palestinian Islamic Jihad also denied involvement.

Some residents of southern Lebanon said they were leaving homes along the border with Israel amid heavy shelling that had so far pounded the outskirts of towns and villages.

A series of incidents over the past months had already elevated the risk of escalation along the Lebanon-Israel border before the last days of fighting in Israel and Gaza.

Hezbollah and Israel exchanged artillery and rocket fire on Sunday.

In a statement, the Israeli military said its soldiers "killed a number of armed suspects that infiltrated into Israeli territory from Lebanese territory". It did not elaborate on the number.

Military helicopters "are currently striking in the area," the statement added.

A security source in Lebanon and a source in Lebanon's border area said a group of men had approached the border, with one firing at an Israeli observation post.

Israel's Army Radio gave the location as being near Adamit, across from the Lebanese border towns of Aalma El Chaeb and Zahajra.

A spokesperson for the U.N.'s peacekeeping mission in Lebanon said the force was aware of an incident at the southern border but did not have further details. Lebanon's army had no immediate comment.

Gabi Hage, a father of three with a house near the border described heavy shelling close to him.

"Our house is really close to the border, so we're leaving and going down to the village. All my neighbours are doing the same thing," he said.