Egypt's military killed 35 Islamist militants in North Sinai on Thursday, security sources said, a day after the deadliest clashes in the region in years.

The sources said those killed had taken part in Wednesday's fighting in which the army said 100 militants and 17 soldiers were killed. The sources said Thursday's casualties included militant field commanders.

Sinai-based insurgents, affiliates of Islamic State, have stepped up attacks on soldiers and police since then-army chief Abdel Fattah Al-Sisi toppled Islamist President Mohamed Mursi in 2013 exactly two years ago after mass protests against his rule.

Sisi, now Egypt's elected president, says the pro-Islamic State group Sinai Province, and other militant factions, pose an existential threat to Egypt, other Arab states and the West.

The militants' assault, a significant increase in violence in the peninsula between Israel, the Gaza Strip and the Suez Canal, was the second major attack in Egypt this week. On Monday, a car bomb killed the prosecutor-general in Cairo, the highest-profile official to die since the insurgency began.

Army forces, backed by aerial support, stormed militant bases south of the North Sinai town of Sheikh Zuweid, the security sources said, and were able to destroy vehicles and weapon storage facilities.

The army also defused 15 bombs planted by the militants as booby traps on the roads and cleared the perimeter of Sheikh Zuweid police station which the militants surrounded by explosives on Wednesday.

This week has been especially troubling for Egypt, a strategic US ally which has a peace treaty with Israel and controls the Suez Canal, a vital global shipping lane.

Israeli Prime Minister Benjamin Netanyahu expressed his condolences to the Egyptian people and government in remarks he made at an Israeli cyber security centre.

"Our hearts are with the Egyptian people," Netanyahu said. "We convey our condolences to the Egyptian government and family members of who lost those dear to them in the struggle against terrorist cruelty."

The Arab League condemned the attack after its meeting on Thursday, calling it "despicable," state news agency Mena reported. - Reuters