At least two Katyusha rockets have been fired into northern Israel from Lebanon in the first cross-border attack since last year's war between Israeli forces and Hezbollah fiighters.

There were no casualties reported after the attack on the town of Kiryat Shmona, police and military officials said on Sunday.

Israeli troops responded by firing five shells into southern Lebanon, security forces said.

The Hezbollah movement has denied firing the rockets and a Lebanese security source told Reuters news agency that Palestinian fighters were suspected of launching the rockets from the village of Taibeh.

"Hezbollah denies being involved in any operation to launch missiles today against occupied Palestine," Hezbollah's al-Manar television said.

An official accompanying Ehud Olmert, the Israeli prime minister, on a visit to the United States said Palestinian fighters were apparently behind the attack.

"The prime minister was updated about the Katyusha rockets immediately after the event and has consulted with the defence minister and foreign minister," Miri Eisen, Olmert's spokeswoman, said. "It seems that it was Palestinians, not Hezbollah."

The Lebanese army said in a statement on Sunday that it had prevented another rocket being fired at Israel.

Troops had been sent to search the suspected launch area and had found a Katyusha equipped with a timer.

 
Haim Barbivai, Kiryat Shmona's mayor, called for a tough response from both the Israeli and Lebanese governments.

"Heaven help us if we have another summer like the last one. That would be a tragedy," he told Channel 2.

Thousands of Katyusha rockets landed on the area during July and August last year as Israeli troops moved into large areas of southern Lebanon.

An international peacekeeping force was deployed after the war to prevent further rocket attacks.

The rocket attacks came as the Lebanese army continued to shell suspected Fatah al-Islam positions in Palestinian refugee camp in the north of the country.

The group, who have been battling soldiers in the Nahr al-Barred camp for four weeks, responded with heavy gunfire, witnesses said.