A Palestinian was killed in a new Israeli air raid early Friday in the north of the Gaza Strip, Palestinian security officials said, while another Palestinian was killed in the West Bank city of Jenin, bringing the Palestinian death toll to 24 since Thursday
A second raid has since taken place, but the Palestinian officials were unable to say whether there were victims.
On Thursday, the Israeli army advanced around five kilometres into northern Gaza, creating a unilaterally declared buffer zone aimed at preventing rocket attacks on Israel.
The army’s intensifying offensive against the Palestinians was also a bid to pressurise the Hamas-led government to secure the release of a captured Israeli soldier.
Thursday was the bloodiest day since Israel launched the operation more than a week ago.
Troops massed around the towns of Beit Hanun and moved into two neighbourhoods of Beit Lahiya in the deepest Israeli ground operation since corporal Shalit was seized 11 days ago.
In response the Hamas government put its security forces on high alert and urged all Palestinians to take up arms against the Israeli military.
"The interior ministry issues a state of alert for security services and calls on all members to set about their religious and moral duty to fight against the Israeli aggression," Palestinian interior ministry spokesman Khaled Abu Hilal said, calling on "all Palestinians" to join the armed struggle.
In the worst incident 11 Palestinians were killed, including two fighters loyal to Hamas, in an Israeli bombardment on Beit Lahiya, one of a series of deadly attacks over the day, medics said.
Bloodstained bodies could be seen huddled together as the wounded frantically carried other victims through the streets.
One Israeli soldier was shot dead in fighting in Beit Lahiya.
The Popular Resistance Committees, one of the Palestinian groups behind last week’s abduction of corporal Gilad Shalit along with the armed wing of Hamas and the Army of Islam, said it was behind the killing.
After night fell, Israel launched more air strikes on Beit Lahiya, killing four Palestinians and bringing the overall number of dead Palestinians in Gaza on Thursday to 22, both civilians and militants.
Dozens of families in northern Gaza, fearing for their lives when confronted with the ominous sight of approaching Israeli armour, fled their homes. Women clutching babies and a few belongings scurried away on foot.
Israeli forces also took over the remains of the Dugit, Elei Sinai and Nissanit settlements, razed last year as part of Israel's historic pullout from Gaza that had meant to draw the curtain on a 38-year occupation.
The return of the troops to Gaza has evoked memories of the army's disastrous full-scale invasion of Lebanon in 1982 where its soldiers became bogged down in a deadly quagmire before pulling out in 2000.
Palestinian prime minister Ismail Haniya slammed the assault as "collective punishment" and demanded international intervention to stop the military operation, Israel’s largest since it pulled out of Gaza in September.
Two-pronged attack
Israeli troops also entered the Gaza Strip deeper in the south in a two-pronged attack.
And in the West Bank, Israeli forces launched an incursion into a refugee camp in the northern city of Jenin, killing a 16-year-old Palestinian and wounding several more people, including militants, medics said.
The Gaza offensive has sparked concerns of a humanitarian fall-out with the 1.4 million residents of the largely impoverished Gaza already grappling with food and water shortages, fuel and power cuts.
Palestinians believe Israel is using the soldier's capture as an excuse to try to topple the government led by Hamas, which is boycotted by the West as a terrorist group as it has not formally recognised Israel or renounced violence.
"If you return Gilad Shalit home safe and sound and if you stop your rocket attacks, we will withdraw our forces," Israeli Defence Minister Amir Peretz told the Palestinians.
The commander of Israel's southern region, Yoav Galant, admitted that troops had encountered "fierce resistance" in parts of Gaza.
"Our objective is to keep rocket attacks at bay, so that those who fire them will pay such a heavy price that they will give up," he said.
An unprecedented Hamas rocket attack on Tuesday in the Mediterranean city of Ashkelon saw Israel's security cabinet order the army to step up its assault and section off parts of Gaza.
Israel has bombed the Gaza offices of both the Hamas premier and interior minister, raided multiple militant targets and detained a third of the cabinet.
International reaction
US Secretary of State Condoleezza Rice called on Israelis and Palestinians to exercise restraint while UN chief Kofi Annan, terming the situation "dangerous" also urged both sides "to step back from the brink".
But the international calls have largely fallen on deaf ears in what has become the worst Middle East crisis since Hamas came to power in March and prime minister Ehud Olmert formally took the helm in May.
Israel has vowed to unleash its full military might on Gaza, while Hamas's armed wing has warned of a "new era of violence" against the Jewish state.
Noam Shalit, the father of the captured soldier, has urged Israel to consider a prisoner exchange, conditions flatly ruled out by the Israeli government.