With several hundred metres (yards) of wall destroyed in Tuesday's demolition, Palestinians continued to cross into Egypt unimpeded through other minor openings. -- PHOTO: REUTERS

Egyptian police did not intervene as a bulldozer was used to demolish a section of the barrier even though the authorities had earlier announced by loudspeaker that the border would be resealed from 1300 GMT.

Police had earlier blocked Gazans from crossing over into Egypt through the largest of the breaches which militants blew in the border wall on Tuesday night in the Saleheddin neighbourhood of the divided frontier town of Rafah.

Egypt set the deadline on Friday for the border with Gaza to be resealed after Washington said it was looking to Cairo to put a stop to the uncontrolled flood of people of the past three days.

A security source said the deadline was intended to give the hundreds of thousands of Gazans who have crossed over since militants blew holes in the border fence in the divided frontier town of Rafah on Tuesday night sufficient time to return home.

The move came as an Israeli air strike killed the Hamas military commander for Rafah and one of his lieutenants early on Friday.

Two other members of the military wing of the Islamist Hamas movement which controls Gaza were also killed during Thursday night when two Israeli missiles slammed into their jeep, medical sources said.

Dozens of Egyptian police deployed around the main crossing point in the concrete border wall.

They blocked the path of Palestinians trying to pass through the breach in the Salaheddin Gate neighbourhood to the Egyptian side, but allowed free passage in the other direction.

However, with several hundred metres (yards) of wall destroyed in Tuesday's demolition, Palestinians continued to cross into Egypt unimpeded through other minor openings.

Witnesses and Hamas security sources said that Egyptian police had set up checkpoints to prevent Palestinians travelling to the provincial capital of El-Arish, 45 kilometres away.

Several other checkpoints had sprung up beyond El-Arish on Thursday to prevent Palestinians travelling to the capital, Cairo. However, the area is almost entirely desert and notoriously difficult to police.

The United Nations said at least 700,000 Gazans have poured into Egypt to stock up on desperately needed supplies since the border was blasted open on Tuesday - nearly half the territory's population of 1.5 million.

US Secretary of State Condoleezza Rice earlier called on Egypt to control its border as Israel defended its week-old Gaza lockdown that has raised fears of a humanitarian crisis in the impoverished Hamas-ruled territory.

'I understand it is a difficult situation for them (Egypt),' Dr Rice said after arriving in Colombia for meetings.

'But it is an international border, it needs to be protected and I believe that the Egyptians understand the importance of doing that.'

US State Department spokesman Tom Casey told reporters on Thursday that he understood US ambassador to Cairo, Frank Ricciardone, had spoken with President Hosni Mubarak and other Egyptian officials about ensuring the border is properly controlled.

'Certainly we hope they will be able to do so in the next few days,' he said.

In New York, UN Security Council talks to hammer out a statement urging an end to the siege dragged on for a fourth day as Washington called for the text to be reworked.

The United States, Israel's staunchest ally, insists the blockade is an act of self-defence but other states have protested at what they term 'collective punishment'.

Israeli Prime Minister Ehud Olmert's government last week blocked fuel and aid shipments into Gaza amid an explosion of violence which has seen 45 people, most of them militants, killed in Israeli raids over the past 10 days.

Israel says its action is aimed at halting militant rocket fire on its territory, with 10 people lightly wounded over as many days from a barrage of 200 rockets or mortar rounds.

The fighting has threatened Israeli-Palestinian peace talks which were relaunched amid great fanfare at a US conference two months ago but have faltered since.

The Rafah border area resembled a busy bazaar on Thursday.

Stands selling falafel and other fast-foods sprouted up to cater to the throngs of shouting, jostling people, intent on buying goods on the Egyptian side of the border.

Israel has progressively tightened restrictions on movement in and out of Gaza since June 2006, when militants from the territory seized an Israeli soldier in a deadly cross-border raid.

After Hamas - a group pledged to the destruction of the Jewish state - seized control of the territory following its defeat of forces loyal to Palestinian president Mahmud Abbas, Israel sealed Gaza to all but humanitarian aid and basic supplies.

The Rafah crossing, Gaza's only border post that bypasses Israel, has been closed almost continuously. -- AFP