JERUSALEM (CNN) -- Clashes between Hamas militants and Israeli soldiers raged to the north and east of densely populated Gaza City early Sunday, the 16th day of an Israeli offensive, witnesses and medical sources said. A photo provided by the Israel Defense Forces shows troops in Gaza on Saturday. Heavy gunfire could be heard to the east of Gaza City -- home to about 400,000 of Gaza's 1.5 million people -- as fighting moved closer, according to a CNN stringer in the area. Israeli shelling north of the city killed two people, sources at Shifa hospital told CNN. Sunday's fighting came after one girl was killed and 49 other people were severely burned by fires caused by Israeli shelling in southern Gaza on Saturday, local hospital sources said.
@highlight
NEW: Fighting nears densely populated Gaza City, witnesses say
@highlight
Sources: Israeli artillery ignites buildings, killing 1 and wounding 49
@highlight
Leader of Gaza City rocket teams is killed, Israel says
@highlight
Israeli jets apparently violate Egyptian airspace
Grad rockets have allowed Hamas to reach farther into @placeholder than in previous attacks.