The navy suspected a smuggling operation was underway late Saturday night, when they identified three suspicious Palestinian boats sailing along the Gaza coast in a no-go area towards Egypt. There, they appear to have made contact with an Egyptian boat that loaded goods, most likely weapons, onto the boats.
The Israeli Navy tracked the Palestinian boats until 5:30 Sunday morning, at which time they returned from Egypt towards Gaza.
The suspected smugglers were ordered to halt by an Israeli naval ship and, when they did not do so, the ship fired shots in warning, and then towards the boats.
The Palestinian boats were damaged but were able to reach the shore in Gaza, where they were met by a large crowd, possibly evacuating wounded crewmen.
"These were not innocent fishermen, but smugglers," the IDF said. It is unclear whether the smuggled goods arrived in Gaza or whether the goods were definitely armaments.
Since the disengagement, there have been several incidents of weapons and explosives smuggling from Egypt to Gaza, via boat. In May, 2006, the navy succeeded in confiscating, in two separate incidents, over a ton of explosive material meant for Qassam makers in Gaza.