Hamas says it has accepted a proposal for a ceasefire in the Israel-Gaza war, brokered by Qatar and Egypt, but Israel says the deal is not acceptable and launched air strikes on Rafah overnight.
Israel says it will send a delegation to Cairo to continue ceasefire negotiations.
Hamas said in a statement late Monday local time that the chief of its political wing, Ismail Haniyeh, had informed Qatar's prime minister and Egypt's intelligence minister of its acceptance.
It is the first ceasefire proposal Hamas has agreed to since a temporary pause in fighting took place in November last year.
The announcement prompted street celebrations in the besieged Gaza Strip. It also brought hopeful Israelis onto the streets of Tel Aviv, demanding the country's government agree.
Those demonstrations were premature.
Israeli prime minister Benjamin Netanyahu's office issued a statement about two hours after Hamas's announcement saying the deal the group had agreed to was "far from" its "necessary requirements".
It also said the country's war cabinet had unanimously decided to continue a planned operation in Rafah, a city in southern Gaza where more than 1 million Palestinian civilians have been sheltering since early in the war.
Israel believes a significant number of Hamas fighters, along with potentially dozens of hostages, are in Rafah and has said that victory requires taking the key city.
Late on Monday, Israel carried out intense air strikes on Rafah that, at one point, were virtually continuous for 30 minutes, an AFP correspondent said.
"They have been firing since last night and today after the evacuation orders, the bombardment became more intense because they want to frighten us to leave," Jaber Abu Nazly, a 40-year-old father of two, told Reuters via a chat app.
"Others are wondering whether there is any place safe in the whole of Gaza," he added.
Reuters also reported one strike on a house in Rafah killed five Palestinians, including a woman and a girl.
Most recently, Palestinian and Egyptian officials said Israeli tanks had entered Rafah and were operating in southern Gaza.
CNN is reporting Israeli forces will take over the Palestinian side of the Rafah-Egypt crossing within hours.
The Egyptian official told AP the operation appeared to be limited, suggesting it was not part of a wider ground invasion.
Meanwhile, the Iron Dome missile defence system intercepted rockets fired into Israel from the north of the Gaza Strip.
Ceasefire negotiations between Israel and Hamas have previously been derailed.
The most significant sticking point has been the length of a potential ceasefire — Hamas has insisted it must be permanent, while Israel demanded it be temporary.
The deal Hamas has agreed to entails three stages, each lasting six weeks. It includes:
- The full withdrawal of Israel's military from Gaza as part of the second stage
- The reconstruction of Gaza
- Allowing people displaced by the war to return to other areas of the strip
- A prisoner swap that would see Israeli hostages being held by Hamas exchanged for Palestinians in Israeli jails
Hamas official Taher Al-Nono said a delegation would visit Cairo soon to discuss next steps, adding the organisation was now waiting to see what the mediators would do after receiving its response.
Israel also confirmed it would send a delegation to Cairo.
The United States said it was aware of Hamas's announcement and would be discussing it with allies in coming hours, adding that a ceasefire was "absolutely achievable".
White House spokesperson John Kirby told a press briefing that CIA director William Burns was in the region discussing the proposal.
"We want to get these hostages out, we want to get a ceasefire in place for six weeks, we want to increase humanitarian assistance," Mr Kirby said.
United Nations secretary-general António Guterres urged Israel and Hamas "to go the extra mile needed to make an agreement come true and stop the present suffering", his spokesperson said.
"The secretary-general is deeply concerned by the indications that a large-scale military operation in Rafah may be imminent," UN spokesperson Stephane Dujarric said in a statement.
Israel's Hostage and Missing Families Forum told the country's government to "take Hamas's acceptance and turn it into a deal".
"Now it's time for the Israeli government to prove, with action, its commitment to its citizens," it said.
Hamas's announcement came after Israel urged the evacuation of 100,000 people sheltering in Rafah on Monday.
It also came after US president Joe Biden spoke to Prime Minister Benjamin Netanyahu in a phone call on Monday.
In a brief summary of the conversation, the White House said Mr Biden underscored the long-standing concerns about any invasion of Rafah.
Mr Netanyahu "agreed to ensure the Kerem Shalom crossing is open for humanitarian assistance for those in need," the White House said, after Israel closed the key border crossing between Israel and Gaza after Hamas rocket attack at the weekend killed several IDF soldiers.
Negotiations between Hamas and Israel had stalled after the strike.
The US State Department said an offensive on Rafah would make it "incredibly difficult" to sustain the increase of humanitarian aid into Gaza.
With Orly Halpern in Jerusalem
