Thousands of Israeli soldiers backed by tanks have entered the Gaza Strip, escalating a 10-day campaign of heavy air bombardment.
Israel's military said a soldier had been killed in the operation. The circumstances of his death were not immediately clear.
It is the first military casualty since Israel announced the start of a ground incursion into Gaza yesterday.
Today is the 11th day of fighting between Israel and Gaza's Hamas rulers.
The heavy thud of tank shells, often just seconds apart, echoed across Gaza City before dawn as flares lit up the night sky.
Sirens from ambulances mixed with the Muslim call to prayer from mosque loudspeakers as thick smoke rose into the air from sites where shells and missiles struck.
Palestinian medics treat a wounded girl at the emergency room of the Shifa hospital in Gaza City today. Photo: AP/Khalil Hamra.
"There is a tank shell every minute," said an official in the Gaza security operations room, who said all border areas were being shelled and Hamas fighters were exchanging fire with Israeli troops in northern Gaza.
Israel launched the offensive after becoming increasingly exasperated with unrelenting rocket fire from Gaza on its cities, especially following Hamas' rejection of an Egyptian ceasefire plan earlier in the week.
But a ground offensive could quickly lead to military and political entanglements for Israel, especially if more Palestinian civilians are killed.
More than 240 Palestinians have already died in the air campaign, including 14 children under 12 killed over the past two days, according to Palestinian health officials. One Israeli has also died.
Hamas spokesman Fawzi Barhoum, said Israel "will pay dearly" for the assault. "Hamas is ready for a confrontation," he said.
The Israeli operation began with what the military said was an open-ended assault to be carried out on several fronts.
"Large ground forces accompanied by massive air force support, naval forces and intelligence, are taking over targets in Gaza, operating against tunnels and terror activists and infrastructure," said chief military spokesman Brig Gen Motti Almoz.
He called on Gaza residents to evacuate targeted areas, warning the "military is operating there with very great force."
Gaza health officials said eight Palestinians were killed in the early stage of the ground operation, including a three-month-old boy who died after a shell hit his family's Bedouin tent in southern Gaza.
The body was evacuated on a donkey cart because ambulances couldn't reach the area due to heavy shelling, the officials said.
Israeli government spokesman Mark Regev said the operation was focused on the tunnels dug by Hamas under the Gaza-Israel border.
Earlier 13 heavily armed Hamas militants had tried to sneak into Israel through such a tunnel, but were stopped by an air strike at the mouth of the tunnel.
"For Israel to send ground forces into Gaza is not a light decision. Ultimately we understand the risks involved both for our own soldiers and the dangers of escalation," he said.
"But we felt this was necessary ... to deal with this strategic threat posed by those tunnels, which can allow terrorists to infiltrate into Israel and cause mass death."
Israeli officials have said the goal is to weaken Hamas militarily and have not addressed the possibility of driving the Islamic militants from power.
However, Hamas has survived Israeli offensives in the past, including a major ground operation in January 2009 from which it emerged militarily weaker, but then recovered.
Hamas has since assembled thousands of rockets and built a system of underground bunkers.
While the ultimate scale of Israel's ambition remained unclear, prime minister Benjamin Netanyahu had come under growing domestic pressure to step up Israel's response to rocket fire that 10 days of air strikes had failed to stem.
Israel has little stomach for the scale of casualties that a takeover of Gaza would likely entail, but Israeli public opinion appears to be nearly at a breaking point over the rockets.
Mr Netanyahu may also have sensed he has a degree of international backing for action after Israel accepted an Egyptian ceasefire proposal on Tuesday that was essentially a return to the status quo ante - and Hamas then rejected it.
Similarly, Hamas ended a "humanitarian lull" of several hours by immediately resuming rocket fire.
But the ground offensive brought swift criticism from United Nations secretary general Ban Ki-moon, who said he regretted that despite his repeated urgings and "those of many regional and world leaders together, an already dangerous conflict has now escalated even further".
Both Mr Ban and the Obama administration took Israel to task for the mounting civilian death toll in Gaza.
"I urge Israel to do far more to stop civilian casualties," said Mr Ban. "There can be no military solution to this conflict."
Noting the deaths a day earlier of four boys who were killed on a Gaza beach by an Israeli strike, the US State Department said the high civilian death toll in Gaza had been "heartbreaking".
But US State Department spokeswoman Jen Psaki also criticised Hamas militants who continue to fire rockets and mortars into Israel, prolonging the latest round of violence.
Thousands of Israeli soldiers were massed on the border with Gaza in recent days, waiting for the order to go in. Israel initially called up 48,000 reserve soldiers and later the Cabinet authorised 18,000 more.
The ground operation followed a brief truce in which Israel held fire to allow Gazans to stock up on food and other necessities after being largely trapped at home since the conflict began last month.
Since July 8 Israeli strikes have hit more than 2,000 targets in Gaza and Hamas launched nearly 1,500 rockets at Israel, the Israeli military has said.
Israel last carried out a major ground offensive in Gaza in January 2009.
During that three-week campaign, some 1,400 Palestinians were killed, including hundreds of civilians. Thirteen Israelis also died.
Israel has blamed Hamas for the heavy civilian toll, saying the militant group staged attacks from heavily populated residential areas, as well as mosques and schools.
Israel's chief military spokesman told Army Radio "there were a number of points of friction through the night" and said the military was investigating the circumstances behind the soldier's death.
The military said it killed 14 militants in a number of exchanges of fire and focused on rocket launchers, tunnels and more than 100 other targets.
It said 50 rockets had been fired at Israel since the start of its ground operation, out of more than 1,500 since the fighting began last week.
Israeli aircraft have struck more than 2,000 targets in Gaza. More than 250 Palestinians have died in the air campaign. An Israeli civilian was killed earlier this week.