Israeli warplanes have struck around 100 Hamas targets in the Gaza Strip in response to a rare rocket attack on the Israeli metropolis of Tel Aviv.
Rocket fire persisted, setting the stage for additional possible reprisals.
The Israeli army said that its targets had included an office complex in Gaza City used to plan and command Hamas militant activities, an underground complex that served as Hamas' main rocket-manufacturing site, and a centre used for Hamas drone development. There were no reports of casualties.
The late-night attack on Tel Aviv, Israel's densely populated commercial and cultural capital, marked a dramatic escalation in hostilities. It was the first time the city had been targeted since a 2014 war between Israel and Gaza militants.
Hamas denied responsibility for the initial rocket attack, saying it went against Palestinian interests. But Israel said that, after a preliminary investigation, it had concluded that the militant group was behind the attack.
Following the Israeli airstrike, several additional rounds of rocket fire were launched into Israel. The military said several rockets were intercepted by its air defence systems, and there were no reports of injuries.
The fighting broke out as Egyptian mediators were in Gaza trying to broker an expanded ceasefire deal between the bitter enemies.
Israel and Hamas are bitter enemies and have fought three wars since the Islamic militant group seized power in Gaza in 2007.
The sudden outburst of fighting comes at a sensitive time for both sides. Israel is holding national elections in less than a month. Prime Minister Benjamin Netanyahu is locked in a tight fight for re-election and could face heavy criticism from his opponents if he is seen as ineffective against the militants.
Cabinet Minister Naftali Bennett called on Netanyahu to convene a gathering of his Security Cabinet and demand the army "present a plan to defeat Hamas". Likewise, Hamas has come under rare public criticism in Gaza for the harsh conditions in the territory. An Israeli-Egyptian blockade, combined with sanctions by the rival Palestinian Authority and mismanagement by the Hamas Government, have fuelled an economic crisis in the territory. Residents have little desire for another war with Israel.
Earlier in the day, Hamas police violently broke up a small protest over the harsh living conditions.