The Israeli military confirmed it carried out an attack in the area, saying the target was a container carrying a car and explosives meant for an attack in Israel.
Palestinian sources said the Palestinian killed was believed to be a bystander, adding that the car attacked was disguised as an Israeli vehicle and that the two missiles fired at it caused several explosions, suggesting that it had been carrying explosives.
The militant Islamic Jihad group said some of its members were in at least one of the two struck by Israeli missiles - a Mercedes saloon and a pickup truck parked alongside.
Earlier Saturday, two Qassam rockets were fired from northern Gaza to Sderot, landing in an open field. The Islamic Jihad said its operatives had fired a rocket into Israel shortly before the air strike, but it was not clear if they were the same group hit by the Israeli strike.
Ali Waked contributed to this report