By Nidal al-Mughrabi GAZA, Sept 26 (Reuters) - Israel killed four Palestinian militants in an air strike in the Gaza Strip on Wednesday and threatened a sweeping military operation in the Hamas-run territory to stem cross-border rocket fire. Palestinian officials said fire from an Israeli ground force struck a house in the town of Beit Hanoun in northern Gaza and killed four civilians in a separate incident. Witnesses and morgue officials identified the dead from the missile strike in Gaza City as members of Army of Islam, a shadowy militant faction which, along with Hamas and another group, abducted an Israeli soldier last year. An Israeli military spokeswoman confirmed there had been an attack by the air force but had no word on its target. Israel had sent an armoured force into northern Gaza in response to rocket attacks. Local residents described it as the deepest incursion since Hamas Islamists took control in June. Earlier, Gazan militants said they fired more than 12 rockets at the southern Israeli town of Sderot. Israeli Defence Minister Ehud Barak said there could soon be a broader sweep in Gaza. "We are getting closer to carrying out a widespread operation in Gaza which, for many reasons, has not taken place in the past weeks," Barak told Israel's Army Radio. Israeli Prime Minister Ehud Olmert has come under pressure from Sderot residents and right-wing politicians to order a large-scale ground operation in the Gaza Strip. Several Israeli cabinet ministers have cautioned that such a campaign could lead to heavy casualties among Israeli forces and Palestinians in the densely populated coastal territory where 1.5 million people live. "It must be clear that an operation of this type is not simple, not in terms of the forces and the amount of time which we will have to stay there or in terms of the operational challenges which the troops will have to meet," Barak said. An Israeli military push into the Gaza Strip in the coming weeks could also complicate plans for a U.S.-sponsored Middle East peace conference expected to take place in November in the Washington area. Last week, Israel declared Gaza an "enemy entity" in response to frequent rocket fire -- which rarely causes deaths but has a powerful impact on life along the border -- and said it would reduce fuel and power supplies to the territory. It has yet to take such actions, which U.N. officials and human rights groups have said would be illegal under international law pertaining to occupied territories. Israel pulled troops and settlers out of the Gaza Strip in 2005 after 38 years of occupation. Palestinians say the territory is still effectively under occupation because Israel controls its borders, waters and airspace. (Additional reporting by Ori Lewis and Jeffrey Heller in Jerusalem)