Israeli warplanes and helicopters pounded the Hamas-ruled Gaza Strip on Saturday, killing at least 195 people. Gunners in the Gaza Strip fired more salvoes that killed one Israeli man and wounded several others.
Both sides said they were ready to stage wider assaults.
According to Reuters, the massive Israeli air strikes destroyed more than 30 security compounds, including two where Hamas was hosting graduation ceremonies for new recruits. Hamas called the assault a "massacre".
Israel said it had targeted "terrorist infrastructure." "There is a time for calm and a time for fighting, and now the time has come to fight," Defence Minister Ehud Barak said. He added that the military campaign would take time and would be expanded "as necessary". Hamas leaders could be targeted, an army spokeswoman said. New Israeli air strike reported after dark in southern Gaza.
On his part, U.N. Secretary-General Ban Ki-moon called for an "immediate halt to all violence".
The administration of U.S. President George Bush backed the Israeli attack. "Hamas' continued rocket attacks into Israel must cease if the violence is to stop," White House spokesman Gordon Johndroe said in a statement.
Hamas threatened to unleash "hell" to avenge the dead, including possible suicide bombings inside Israel. Hamas estimated that at least 100 members of its security forces were killed, including police chief Tawfiq Jabber and the head of Hamas' security and protection unit, along with at least 15 women and some children.
Palestinians staged protest rallies in East Jerusalem, and in the West Bank cities of Ramallah and Hebron.