The fatalities were identified by the Gaza health ministry as Salam Sabah and Abdullah Abu Sheikha, both 17, who were killed during a strike east of Rafah in southern Gaza.
According to Palestinian eye witnesses, the two were killed by shots near the border.
The Israeli army said that its forces had fired "warning shots" at a number of Palestinians approaching the border fence "in a suspicious manner".
Their death comes after Israel launched a series of air strikes targeting 18 "terror targets belonging to Hamas" in Gaza, after the explosive device wounded soldiers and a projectile from Gaza hit in an Israeli border town.
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