The Israeli military has discovered an underground tunnel dug out from the Hamas-controlled Gaza Strip into Israel.
It says it believes militants intended to use the passageway to attack or kidnap Israelis.
In response, officials have frozen the transfer of all construction materials to the Palestinian territory.
A Hamas military spokesman in Gaza, Abu Obeida, was defiant over the discovery, saying on his official Twitter account "thousands" more tunnels would be dug out.
Hamas has dug tunnels into Israel in the past.
In 2006, Hamas-allied militants sneaked into Israel through one, kidnapped a soldier, Gilad Schalit, and held him hostage in Gaza for five years.
According to the Israeli military, the latest tunnel is 2.5 kilometres long and appears to have been recently excavated and in use until its discovery last week.
A tunnel opening was found near a kibbutz along the Israel-Gaza border, and the military speculated that Hamas may have been planning an attack on a kindergarten there.
The military said it waited a week to publicise the discovery because a search for explosives was underway.
The army said an elite engineering corps was sent into the tunnel but would not say whether explosives were found.
Prime Minister Benjamin Netanyahu praised the discovery and said Israel's resolute policy toward the Gaza Strip, including last year's military offensive, has led to the "quietest year in more than a decade" along the Israel-Gaza border.
Army spokesman Major Guy Inbar said the halt on all construction material to Gaza, announced on Sunday, was enacted due to security considerations and was not meant as a punishing measure.
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