The Iron Dome defense system has been placed in the southernmost city of Eilat, two days after two rockets were fired from Egypt.

Missile attacks or even the threat of rocket strikes could have a catastrophic effect on the local economy, almost totally dependent on tourism.

"An Iron Dome battery has been deployed in the town of Eilat as part of tests, momentarily modifying the sites where these systems are deployed," an IDF spokeswoman said.

An Islamic terrorist group that calls itself Ansar Jerusalem claimed responsibility for firing two Grad rockets on Eilat last week. The explosions were heard, but there was no evidence of rocket firing until a mountain hiker found the remains of a 122m rocket on Saturday.

The Ansar terrorist group blamed “the Jews” for claiming there were no deaths or injuries. Its statement claimed that the terrorists tried to make sure the missiles would hit populated areas, “but as usual, the Jews are hiding their losses, and in their reports and releases they claimed that the rockets fell in open, unpopulated areas.”

It added, “You know, Jews, that nothing can stop us with Allah’s help, from fighting you and torturing you…

“Everyone knows that our weapons, our readiness and our jihad have a fixed target and are fighting those who cursed Allah, stole our communities, our holy places and hurt our dignity.”

However, another unknown organization calling itself the "Salafi Sinai Front" also claimed responsibility for firing the missiles.

Eilat has been the target of missile attacks from Sinai in the recent past, and eight people were killed in a multi-pronged terrorist attack last year. (IsraelNationalNews © 2011 08/20/12)