Israel has reduced the permitted area for Gaza fishermen to practice their trade from 9 nautical miles off shore to 6 nautical miles.
Palestine Fishermen's Union President Nizar Ayyash said that they had been notified of the decision by Israel's Ministry of Agriculture.
Ayyash said that the reduction in fishing area came into effect Tuesday.
The Israeli authorities had extended the area from 6 nautical miles to 9 nautical miles in May.
Around 4,000 Palestinian fishermen work off the coast of the Gaza Strip, which is under an Israeli blockade, providing vital food to 50,000 people.
While the Oslo Accords signed in 1993 state that Palestinians can fish up to 20 nautical miles off the shore, the Israeli authorities regularly prevent fishermen from exercising their full rights under the agreement.
Israeli forces frequently fire upon Gaza fishermen, even while within the fishing zone imposed by Israel.
There were 126 instances of the Israeli navy firing at Palestinian fishermen and their boats in 2016, resulting in the injuries of 12 fishermen, according to the Palestinian Centre for Human Rights (PCHR).
One fisherman, 28-year-old Mohammed Majed Bakr, was shot and killed by Israeli forces in May.
The 2 million inhabitants of Gaza have been living under an Israeli blockade since 2007, being deprived of basic commodities such as food, fuel, medicine and building materials.
The Gaza Strip largely depends on foreign aid as the economy has stalled under the Israeli blockade.