The Israeli military said "contrary to the reports" it did not strike a UNIFIL vehicle in the area of the border town of Rmeish.

There was no immediate comment from UNIFIL - the UN peacekeeper mission in southern Lebanon - about the incident.

UNIFIL accompanies technical observers monitoring the Blue Line, which divides the border between Lebanon and Israel.

One of the security sources told Reuters the car carried three UN technical observers and one Lebanese translator.

Both sources said the Israeli strike had left several of those in the car wounded.

Israel has exchanged regular fire with the Iran-backed Hezbollah militant group in Lebanon since the beginning of the war between Israel and Hamas in October.

Israel's shelling of Lebanon has killed nearly 270 Hezbollah fighters - as well as around 50 civilians including children, medics and journalists - and has hit both UNIFIL and the Lebanese army.

In November UNIFIL said one of its patrols was hit by Israeli gunfire in southern Lebanon. No casualties were reported.

A series of Israeli airstrikes in southern Lebanon killed 16 people on Wednesday, while a barrage of rockets fired by Hezbollah killed one Israeli man, making it the deadliest day in more than five months of fighting along the border.

A day later UNIFIL said it was "very concerned over the surge of violence occurring across the Blue Line right now".

"This escalation has caused a high number of civilian deaths and the destruction of homes and livelihoods," it added.

"It is imperative that this escalation cease immediately. We urge all sides to put down their weapons and begin the process toward a sustainable political and diplomatic solution."

Concerns have grown about further escalation between Israel and Hezbollah, with tens of thousands of people on both sides displaced by the violence.