The strikes came after at least two of dozens of rockets launched from the coastal enclave hit the Israeli town of Sderot, near Gaza's northern border, police and the army said.
The Gaza Health Ministry say pregnant 23-year-old Enas Khammash and her 18-month daughter were killed in Jafarawi in central Gaza.
The Israel Defense Forces hit 12 Hamas positions across the Gaza Strip, including a factory that produces concrete for terror tunnels, late Wednesday night after several dozen rockets were fired on southern Israel by the Hamas terror group.
However, earlier in the evening, at least two Israelis were injured as a result of rockets that landed in Sderot.
An explosion is seen during an Israeli air strike in Gaza City August 8, 2018.
The majority hit open areas while 11 were intercepted, it said.
Injuries were also reported on both sides.
At least two Palestinians were wounded in raids aimed targeting a Hamas base in the southern Gaza Strip, the enclave's health ministry said.
Israel has lost tracts of farmland and forest to fires started by kites and helium balloons laden with incendiary material which have caused fires in Israeli forests and farmlands and flown over the border by Palestinians in Gaza.
Liverpool are Man City’s bogey team, says Kyle Walker
Guardiola's team are the favourites for the domestic title once again as they prepare to kick off the new season at Arsenal on Sunday.
Adam Burniston's Forecast | Active storm pattern coming to the Commonwealth
Tonight , a very weak disturbance will be rolling through which could touch off a few isolated showers or T'storms in the evening. After a stretch where we couldn't buy a drop of rain, we can't rule it out in any of the next seven days.
Egypt allows domestic gas into Gaza for 1st time
The Israel Defense Forces confirmed in a statement that an aircraft fired at the group in the northern Gaza Strip. Senior PLO official Ahmed Majdalani said any agreement with Israel should not be limited to "Hamas".
Jamie McGoldrick, the United Nations' humanitarian coordinator for the Palestinian territories, in a news release called Israel's restriction of fuel imports "a unsafe practice, with grave consequences on the rights of people in Gaza".
The strikes came after two fighters from the military wing of Hamas, which rules Gaza, were killed by Israeli fire on Tuesday.
"I am deeply alarmed by the recent escalation of violence between Gaza and Israel, and particularly by today's multiple rockets fired towards communities in southern Israel", UN envoy Nickolay Mladenov said in a statement.
Hamas warned Israel - with which it has fought three wars since 2008 - it would pay for the attack.
More than 160 Palestinians have been killed by Israeli fire since the Great March of Return protests were launched at the end of March.
The escalation comes after the Hamas leadership convened for a rare meeting in Gaza on Friday.
The Swedes were all activists from the "Ship to Gaza" group who were attempting to break Israel's blockade and bring supplies including medical equipment to Gaza, while the remaining five people on the boat included three crew members from Canada, France and Germany, and two British journalists.
The attacks come as the United Nations and Egypt try to secure a deal between Israel and Hamas for a lasting truce.
In an earlier statement, the Israeli military said gunmen had fired on its soldiers from a Hamas post, which was shelled by a tank in response.