Israel has warned its citizens to leave the Sinai Peninsula immediately, saying there is a "very high concrete threat" of a terrorist attack, a National Security Council statement said.
"The possibility of attacks against tourist sites in the Sinai area in the immediate term" is very strong," it added.
Israelis were also told to pass on the warning to any of their family members there.
The council upgraded its warning to the highest level on Wednesday in connection with the January 25 anniversary of the 2011 uprising in Egypt
The Sinai's eastern coast holds many of Egypt's main tourist resorts, but unrest since the country's revolution six years ago has driven away business.
The area's tourist industry was dealt a further blow in late 2015 when a Russian jet carrying holiday-makers back from the peninsula broke up shortly after take-off.
A local branch of Islamic State, which is highly active in northern Sinai, claimed responsibility for downing the jet. Russian authorities said the crash was caused by a bomb.