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Prime Minister Ariel Sharon on Thursday accepted an Israel Defense Forces plan to reposition troops from the Jebalya refugee camp in the northern Gaza Strip to the adjacent hills.

Sharon's decision came at the end of a meeting with Defense Minister Shaul Mofaz and senior IDF officers.

Citing safety concerns, the IDF recommended a redeployment of forces earlier this week. Sharon was opposed to easing-up the current IDF operation - Days of Penitence - which is meant to bring an end to Qassam rocket attacks on the town of Sderot and nearby communities in the Negev.

According to the decision, the size of IDF forces taking part in the operation will be reduced. The operation, however, will continue, and forces will be on alert and ready to push into the Gaza Strip in the event that rocket attacks on Sderot will persist.

According to Palestinian sources, the IDF started pulling forces from the Jebalya refugee camp and from the town of Beit Lahiya prior to Sharon's meeting with Mofaz.

During the past week Mofaz avoided making any reference to the prime minister's differences with the IDF.

Earlier on Thursday, Sharon told the Knesset Foreign Affairs and Defense Committee that the IDF operation in northern Gaza would continue as long as there were casualties on the Israeli side.

IDF officers taking attending the committee meeting noted that the operation is achieving its goals and that dozens of members of militant organizations, belonging to nine rocket-launching cells, have been killed.

The officers noted that due to the IDF operation, militants launching Qassam rockets have been forced to retreat. They also said that the number of rockets launched has decreased significantly, and that the level of accuracy has been greatly diminished.

Five Palestinians killed in IAF air strikes ThursdayFive Palestinians were killed, two of them Hamas militants, in Israel Air Force missile strikes in the Gaza Strip early Thursday.

Two Hamas militants were killed in an IAF strike in the Jabalya refugee camp, in northern Gaza. According to the IDF, troops targeted militants that had been planting explosives.

Palestinian witnesses and medics reported three fatalities, including a 70-year-old man, in an IAF strike in the Rafah refugee camp, in southern Gaza earlier Thursday. Seven more Palestinians were wounded, residents of the camp said.

Five Palestinians killed in Gaza on WednesdayA 16-year-old boy was shot dead and his 7-year-old cousin hit in the stomach by IDF fire close to the Rafah refugee camp on Wednesday, hospital sources said.

Witnesses said the fire came from IDF vehicles moving along the Gaza-Egypt border, just south of the camp.

The IDF said that the boys had been in a no-go zone.

Also Wednesday, an IAF missile strike killed a Hamas militant in the northern Gaza town of Beit Lahiya, hours after troops and tanks moved into the area.

Hamas officials identified the dead man as 24-year-old Hassan Shakfi.

Earlier Wednesday, two armed Palestinians were killed by a tank shell in Beit Lahiya. The IDF said that the two were members of a cell that was firing Qassam rockets.

Witnesses and hospital officials said that seven other people were wounded by the shelling.

Earlier in the day, Palestinian medics said an IAF helicopter fired a missile into a house during a gun battle, killing Hamas militant Mohammed Marous, 22.

Three other militants were wounded, two of them critically, they said. The fighting erupted before dawn, as IDF tanks moved deeper into the town.

Palestinians fire two Qassams at SderotMeanwhile, Palestinians fired two Qassam rockets at the Negev town of Sderot on Wednesday morning.

The rockets landed in an open area a little outside Sderot, and no injuries were reported. The rocket early-warning system that went in place Tuesday in Sderot worked according to plan and the alert was heard throughout the town, said Sderot's municipal security officer.

"The system is a success," said Yehuda Ben-Maman.

Troops also destroyed the Jenin-area house of an Islamic Jihad militant involved in attacks against Israelis, Army Radio reported Wednesday.

Girl, 12, shot by IDF in Khan Yunis dies of her woundsA 12-year-old Palestinian girl died in a Khan Yunis hospital Wednesday of wounds sustained when she was shot by IDF troops in the Gaza Strip refugee camp the day before.

The girl was seriously wounded inside her United Nations-run school when IDF fire from nearby the Neve Dekalim settlement, in Gush Katif, aimed at what the army said was a Palestinian mortar squad.