Israeli fire killed a Palestinian man near the Gaza border on Saturday, Palestinian Health officials said, as Israel's forces massed at the frontier ahead of a rally to mark the first anniversary of a surge of Gaza border protests.

The Israeli military said it had not heard of any such incident. Palestinian medics said the man was killed by bullet shrapnel before dawn at a site of frequent night protests near the border.

On Friday night, the Israeli military said Palestinians were throwing explosive devices at the border fence.

Tensions have mounted along the Israel-Gaza border this week ahead of the commemoration of the 'Great March of Return' border protests, which began on March 30 last year.

Fighting flared when a Palestinian rocket attack from Gaza wounded seven Israelis in a village north of Tel Aviv on Monday. In response, Israel launched a wave of air strikes and moved armour and reinforcements to the border.

The Israeli forces remained at the border area on Saturday and the military said it was expecting "violent riots" to take place and was prepared for escalation.

Tens of thousands of Palestinians were expected to attend the protests, which have turned deadly in the past, and Egyptian mediators were working to avoid further bloodshed. Leaders of Gazan armed groups Hamas and Islamic Jihad said that progress had been made in the truce talks.

LETHAL FORCE

About 200 Gazans have been killed by Israeli troops since the protests started, according to Palestinian Health Ministry figures, and an Israeli soldier was killed by a Palestinian sniper.

The demonstrations have turned into a standoff between Gazans hurling rocks and explosives and Israeli troops across the border. Palestinians have also launched incendiary balloons and kites into Israel and breached the Israeli frontier fence.

Israel's use of lethal force has drawn censure from the United Nations and rights groups. U.N. investigators said last week that Israeli forces may be guilty of war crimes for using excessive force.

Israel says it has no choice but to use deadly force at the protests to prevent militants from breaching the border fence and attacking civilian communities in the area.

The protesters are calling for the lifting of a security blockade imposed by Israel and Egypt, and for Palestinians to have the right to return to land from which their families fled or were forced to flee during Israel’s founding in 1948.

More than 2 million Palestinians are packed into the narrow coastal enclave where poverty and unemployment rates are high. The Isla mist Hamas group rules the territory and has fought three wars with Israel in the past decade.

The blockade is cited by humanitarian agencies as a key reason for impoverishment in Gaza.

Israel seized Gaza in a 1967 war and pulled out its troops in 2005. The security blockade, it says, is necessary in order to stop weapons from reaching Hamas and other armed groups which have fired thousands of rockets into Israel.