Israel is placing troops along the Gaza frontier and calling up 9,000 reservists ahead of a possible ground invasion of the Hamas-ruled territory.
It comes as the two bitter enemies plunged closer to all-out war while Egyptian mediators who rushed to Israel for cease-fire efforts saw no signs of progress.
The stepped-up fighting coincided with the eruption of communal violence in Israel for a fourth night, with Jewish and Arab groups clashing in the flashpoint town of Lod.
The four-day burst of violence has pushed Israel into uncharted territory – dealing with the most intense fighting it has ever had with Hamas while simultaneously coping with the worst Jewish-Arab violence inside Israel in decades.
A late-night barrage of rocket fire from Lebanon that landed in the sea threatened to open a new front along Israel’s northern border.
Saleh Aruri, an exiled senior Hamas leader, told London-based satellite channel Al Araby early on Friday his group has turned down a proposal for a three-hour lull to allow for more negotiations toward a full cease-fire.
The Israeli military said air and ground troops struck Gaza early on Friday in what appeared to be the heaviest attacks yet.
Masses of red flames illuminated the skies as the deafening blasts from the outskirts of Gaza City jolted people awake.
Prime Minister Benjamin Netanyahu said in a videotaped statement: “I said we would extract a very heavy price from Hamas.
“We are doing that, and we will continue to do that with heavy force.”
The fighting broke out late on Monday when Hamas, claiming to be the defender of Jerusalem, fired a barrage of long-range rockets toward the city in response to what it said were Israeli provocations.
Israel quickly responded with a series of airstrikes and, since then, has attacked hundreds of targets in Gaza.
The strikes set off scores of earth-shaking explosions across the densely populated territory. Gaza militants have fired nearly 2,000 rockets into Israel, bringing life in the southern part of the country to a standstill.
Several barrages targeted the seaside metropolis of Tel Aviv, some 45 miles away.
Gaza’s Health Ministry said the death toll has climbed to 109 Palestinians, including 28 children and 15 women, with 621 people wounded.
The Hamas and Islamic Jihad militant groups have confirmed 20 deaths in their ranks, though Israel says that number is much higher.
Seven people have been killed in Israel, including a six-year-old boy.
The current eruption of violence began a month ago in Jerusalem, where heavy-handed Israeli police tactics during Ramadan and the threatened eviction of dozens of Palestinian families by Jewish settlers ignited protests and clashes with police.
A focal point of clashes was Jerusalem’s Al-Aqsa Mosque, built on a hilltop compound that is revered by Jews and Muslims.
Israel regards Jerusalem in its entirety as its capital, while the Palestinians want east Jerusalem to be the capital of their future state.
The violent clashes between Arabs and Jews in Israel resulted in scenes not witnessed in more than two decades.