An Israeli strike on a car in south Lebanon Saturday martyred three Hezbollah fighters, a security source said, the latest in almost five-months of escalating cross-border fire between the Iran-backed group and Israel.

Since war erupted between Israel and Gaza-based Palestinian fighter group Hamas on October 7, Hezbollah has been launching near-daily attacks from Lebanon into northern Israeli in support of its ally Hamas, while Israel has been striking south Lebanon.

Lebanon's state-run National News Agency reported that "an enemy drone targeted a car this morning on the road to Naqura", a coastal town near the Israeli border, adding that ambulances rushed to the scene.

A security source told AFP that three Hezbollah fighters were killed in the strike.

In separate statements Saturday, Hezbollah said three of its fighters were "martyred on the road to Jerusalem", the phrase the group uses to refer to members killed by Israeli fire.

Images taken by an AFP correspondent showed a burnt-out car on a seaside road.

In a statement, the Israeli army said its aircraft targeted a car in southern Lebanon transporting "a number of terrorists who launched rockets into Israeli territory".

Before the strike, Hezbollah said its fighters had launched a drone attack on an Israeli military post.

The cross-border violence has raised fears of all-out conflict between Hezbollah and Israel, which last went to war in 2006.

Hezbollah had announced the deaths of four fighters after an Israeli strike Friday night on a house in south Lebanon's Ramia area, while Israel said it struck Hezbollah "military" buildings in the region.

The fighting has displaced tens of thousands on both sides of the border and killed at least 296 people in Lebanon, most of them Hezbollah fighters but also including 46 civilians, according to an AFP tally.

In Israeli, 10 soldiers and six civilians have been killed.

Hezbollah has said it will stop fighting once Israel ends its Gaza offensive, while Israeli Defence Minister Yoav Gallant has said there will be no let-up in Israeli action against Hezbollah even if a Gaza ceasefire and hostage deal is secured.