The background to the founding of Unit 101 was the Palestinian infiltration into the young state of Israel from its Arab neighbours during which hundreds of Israelis were murdered.
Israel's initial responses did not manage to contain this phenomenon. Although Jordanian and initially Egyptian authorities tried to comply with the cease-fire agreements, the decision was almost never carried out by troops on the ground. So in 1951 the IDF formed Unit 30 - a classified Unit that belonged to the IDF South command. Unit 30 was designed to execute retaliation missions while operating in small and well-trained teams. However, Unit 30 operatives lacked sufficient and proper SF training, and performed poorly, so in 1952 the Unit was disbanded. After a series of unsuccessful raids, the Israeli government decided in summer 1953 on the creation of a special forces unit, Israel's first. Reservist Ariel Sharon was called back to duty, given the rank of major and chosen to command the company-sized unit. Unit 101 was composed of 20-25 men, most of them former T'zanhanim (Paratroopers) and Unit 30 personnel. Immediately after the foundation of Unit 101 in 1953, it began a series of retaliatory operations targeting bases and villages which served as bases for the infiltrators.
On one of its first missions, the unit attacked the refugee camp in El-Bureij in Gaza Strip.
The mission was aimed at Col. Mustafa Hafez, the chief of Egyptian intelligence in the Gaza Strip (and according to some, the Strip's de-facto ruler) who stood behind many of the early violent infiltrations into Israel.
According to the local UN officer Vagn Bennike, hand grenades were thrown into houses while the inhabitants were sleeping, and those trying to escape were mowed down with machine guns.
Only two months later, in October, a heavy shadow was cast on the unit, following its raid into the village of Qibya, in the northern West Bank then a part of Jordan.
Up to 70 innocent civilians were killed in this operation. The mode of operation was similar to that of El-Bureig, but on a larger scale.