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Israel's military says it responded with artillery fire after a rocket was launched from southern Lebanon.
A statement said the rocket "exploded adjacent to the Blue Line in Israeli territory", referring to the UN-demarcated frontier between the states.
Lebanon's state news agency reported that more than 15 Israeli shells had hit the outskirts of the Lebanese villages of Kfar Shouba and Halta.
So far no militant groups have claimed they were behind the rocket launch.
The United Nations peacekeeping force in Lebanon, Unifil, urged all sides to "exercise restraint and avoid any action that could cause further escalation" on the frontier, where tensions have increased in recent months.
In April, the Israeli military carried out air strikes on targets it said belonged to the Palestinian militant group Hamas in southern Lebanon after more than 30 rockets were fired from there towards Israeli territory.
It was the biggest such barrage from Lebanon since Israel and Lebanese militant group Hezbollah fought a war in 2006.
Unifil said that its peacekeepers detected explosions near al-Majidiya shortly after 08:00 local time (05:00 GMT) on Thursday, and that while they could not confirm the cause the sounds were consistent with a possible rocket launch.
Around 12:00, they detected shellfire from Israel hitting Kafr Shouba, it added.
There were no immediate reports of any damage or casualties.
Security sources in Lebanon told Reuters news agency that two rockets were fired towards Israel on Thursday.
The sources said one landed in Lebanese territory and the other near the contested village of Ghajar, which straddles the frontier between Lebanon and the Israeli-occupied Syrian Golan Heights.
Israel currently occupies both halves of the village and was supposed to have withdrawn from the Lebanese half under the UN Security Council resolution that ended the 2006 war.
Hezbollah has not commented on the rocket fire. But earlier on Thursday the Iran-backed group issued a statement condemning the "serious measures" recently taken by Israeli forces in Ghajar, including "the erection of a barbed wire and the construction of a cement wall surrounding the entire town".
Last month, Israel filed a complaint with the UN saying that Hezbollah had erected two tents a few metres over the frontier on Israeli land in the area.
Israeli media reported on Sunday that the group had dismantled one of the tents amid growing international pressure.
Thursday's exchange of fire also comes a day after Israeli forces completed a major operation in Jenin refugee camp in the occupied West Bank.