Egypt launched air strikes in the Sinai region close to the border with Israel on Wednesday, killing at least 20-23 suspected Islamic militants, the state-run Ahram news website said.

The air strikes on positions in the town of Sheikh Zouaid followed the deaths of 16 border guards last Sunday in an attack blamed partly on Palestinian militants.

The incident marks the first time the Egyptian Air Force has been called into action in Sinai since 1973. As per peace agreements, Egyptian Air Force activity in Sinai must be coordinated with Israel.

The Egyptian General Intelligence Service, the body responsible for collecting information and thwarting attacks by foreign entities, reported that according to information in the agency’s possession, the attack in which 16 Egyptian border guards were killed was carried out by rebel groups from Gaza and Sinai.

Murad Muwafi, head of the Egyptian General Intelligence Service, stated that his agency held information concerning a possible terrorist attack prior to the attack on Sunday night. According to Muwafi, the Egyptian General Intelligence Service is not an operational organization, and as such the information was passed on to the appropriate operational entities.

Witnesses in Sheikh Zouaid, about 10 km (six miles) from Gaza, said they saw two military jets and heard sounds of explosions. Other witnesses in a nearby area said they saw three cars hit.

The strikes follow clashes between armed men and security forces at several security checkpoints in the Sinai region.

Armed men opened fire on several checkpoints in Arish and in the nearby town of Rafah on the border with Israel, according to a Reuters reporter and state media.

A Reuters reporter said one policeman and one resident had been confirmed wounded in these attacks.

Lawlessness in the rugged desert region bordering Israel has spread since the fall of autocratic leader Hosni Mubarak in an uprising 18 months ago and the election of an Islamist successor whose commitment to security cooperation with the Jewish state has yet to be tested.

One of the checkpoints attacked on Wednesday has been attacked 28 times since the uprising, the state-funded Middle East News Agency said.

A few hours after the eruption of the clashes, hundreds of protesters gathered in Arish demanding state protection and chanting "God is Great."

Security forces closed Arish's main highway shortly after the start of the attacks.

Earlier on Tuesday, crowds of angry mourners wept at the military funeral in Cairo of the 16 guards killed in what was the deadliest assault in decades along Egypt's tense Sinai Peninsula border with Israel and Gaza.

In reaction to Sunday's attacks, Egypt began to seal off smuggling tunnels into the Gaza Strip, a security source said.

A Reuters reporter in Rafah said heavy equipment was brought to the Egyptian side of the tunnels, which are used to smuggle people to and from Gaza as well as scarce food and fuel for the small territory's population.