Israel’s army said it was “not responsible for the incident”.
“According to our information, the cause of the explosion came from the Gaza Strip,” the army said on Twitter.
Nizar Ayyash, head of Gaza’s fishermen union, confirmed the deaths 15 nautical miles (28 kilometres) off the coast of Khan Yunis in southern Gaza.
Ayyash said the deaths were caused by “shells of unknown origin (striking) their boat”.
Last September, Hamas Islamists who have controlled the Gaza Strip since 2007 and the fishermen’s union blamed Egypt’s army for the death of three fishermen off Gaza.
Israel, which has imposed a blockade on Gaza since 2007, say fishing is sometimes used as a cover for smuggling.
Directly south of Gaza is Egypt’s Sinai Peninsula, where security forces are battling both clandestine trade and jihadist groups