The violence, which has claimed more than 1,500 lives, prompted international declarations of support for Israel after a devastating weekend attack by Hamas, and appeals for an end to the fighting and protection of civilians.

Israeli TV channels said the death toll from the Hamas attack had climbed to 900 Israelis, with at least 2,600 injured, and dozens taken captive. Among the Israeli dead were 260 mostly young people gunned down at a desert music festival, where some of the hostages were abducted.

Israeli Prime Minister Benjamin Netanyahu vowed revenge in a fiery speech accusing Hamas of executing tied-up children and other atrocities. "This vile enemy wanted war and it will get war," he said.

Gaza's Health Ministry said at least 687 Palestinians had been killed and 3,726 wounded in Israeli air strikes on the blockaded enclave since Saturday. Apartment blocks, a mosque and hospitals were among the sites attacked, and the strikes destroyed some roads and houses, according to media reports and eyewitnesses.

Israel also bombed the headquarters of the private Palestinian Telecommunication Co., which could affect landline telephone, internet and mobile phone services.

The strikes continued into the night on Monday. The Israeli military said it hit targets in the Gaza Strip from the sea and air, including a weapons depot it said belonged to Islamic Jihad and Hamas targets along Gaza's coast line.

Hamas spokesperson Abu Ubaida issued the threat on Monday to kill Israelis among the dozens held captive after the surprise attack on Saturday morning. He said Hamas would execute an Israeli captive for every Israeli bombing of a civilian house without warning, and broadcast the execution.

There was no immediate response from the Israeli military to that threat. Israeli Foreign Minister Eli Cohen said more than 100 people had been taken captive by Hamas during the deadly cross-border incursion over the weekend.

FORCED FROM HOME

Palestinians reported receiving calls and mobile phone audio messages from Israeli security officers telling them to leave areas mainly in the northern and eastern territories of Gaza, and warning that the army would operate there.

Dozens of people in Gaza City's Remal neighbourhood fled their homes.

"We took ourselves, children and grandchildren and daughters-in-law and we ran away. I can say that we became refugees. We don't have safety or security. What's this life? This is not a life," resident Salah Hanouneh, 73, said.

In Israel's south, scene of the Hamas attack, Israel's chief military spokesperson said troops had re-established control of communities inside Israel that had been overrun, but isolated clashes continued as some gunmen remained active.

Sirens warning of incoming rocket fire blared in Israeli communities near the Gaza border overnight.

The announcement that 300,000 reservists had been activated in just two days added to speculation that Israel could be contemplating a ground assault of Gaza, a territory it abandoned nearly two decades ago.

"We have never drafted so many reservists on such a scale," chief military spokesperson Rear-Admiral Daniel Hagari said. "We are going on the offensive."

The impact was felt internationally, with governments including Italy, Thailand and Ukraine reporting that their citizens had perished. In Washington, President Joe Biden announced that at least 11 Americans had been killed and it was likely U.S. citizens were among those held hostage.

"I have directed my team to work with their Israeli counterparts on every aspect of the hostage crisis, including sharing intelligence and deploying experts from across the United States government to consult with and advise Israeli counterparts on hostage recovery efforts," Biden said in a statement.

As Israel conducted intense retaliatory strikes on Gaza, Defence Minister Yoav Gallant drew international condemnation by announcing a tightened blockade to prevent food and fuel from reaching the strip, home to 2.3 million people.

"Depriving the population in an occupied territory of food and electricity is collective punishment, which is a war crime," Omar Shakir, Israel and Palestine Director at Human Rights Watch, said in a statement.

Hamas-affiliated media said at least 20 people had been killed in Israeli strikes on houses in the Gaza Strip late on Monday. Palestinian media also reported that an Israeli air strike on a building in Gaza City had killed two Palestinian journalists and seriously wounded a third.

Reuters was not immediately able to confirm the reports. The Israeli military had no immediate comment.

As it rained, explosions and lightning lit the skies, and the sound of bombings mixed with thunder.

INTERNATIONAL RESPONSE

U.N. Secretary-General Antonio Guterres said some 137,000 people were taking shelter with UNRWA, the U.N. agency that provides essential services to Palestinians.

Washington - which provides Israel with $3.8 billion in military assistance each year - said it was sending in fresh supplies of air defenses, munitions and other security assistance to Israel.

The British, French, German, Italian and U.S. governments issued a joint statement recognising the "legitimate aspirations" of the Palestinian people, and supporting equal measures of justice and freedom for Israelis and Palestinians alike.

They also said they would remain "united and coordinated" to ensure Israel can defend itself.

Egyptian President Abdel Fattah al-Sisi and his Turkish counterpart Tayyip Erdogan called on Hamas and Israel to immediately end violence and protect civilians, the Egyptian presidency said.

Qatari mediators held urgent calls to try to negotiate freedom for Israeli women and children seized by Hamas in exchange for the release of 36 Palestinian women and children from Israeli prisons.

The prospect that fighting could spread alarmed the region and world.

Lebanese armed group Hezbollah fired rockets into northern Israel in response to at least three of its members being killed in Israeli shelling of Lebanon. Israel said one of its deputy commanders was killed in an earlier cross-border raid from Lebanon.

Fears of a widening conflict meant more volatility for investors. Oil prices jumped more than 4%, gold gained and the U.S. dollar edged up against the euro. Major international air carriers suspended or reined in service to or from Tel Aviv.

The shocking images of the bodies of hundreds of Israelis sprawled across the streets of towns, gunned down at the outdoor dance party and abducted from their homes were like nothing seen before in the decades-old Israeli-Palestinian conflict.

"I have never felt so close to death, this time I really felt like it was the end. You know I live on the Gaza border and I’ve seen things in my life but I’ve never felt this close," said Zohar Maariv, 24, who survived the attack on the music festival.