An AFP photographer witnessed the pre-dawn raid in which fighter-bombers fired missiles into the Shiite suburb south of Beirut after Hezbollah militants blocked access to the area.
The air raids also targetted a nearby bridge leading to Beirut international airport.
Anti-aircraft guns were swiftly in action in the area.
At least 46 civilians have been killed during the Israeli assault on Lebanon.
Relentless air raids
After a day of relentless air raids on targets across southern Lebanon, two rockets fired from south Lebanon penetrated deep inside Israel hitting the country’s third largest city of Haifa.
However Hezbollah denied it was involved in the attacks.
The UN Security Council will meet tomorrow to discuss the crisis and Lebanon's government asked the UN to order a cease-fire in the cross-border fighting.
Israeli forces have hit fuel tanks at Beirut's international airport and imposed an air and sea blockade on Lebanon’s ports.
Israeli war planes have also fired missiles on two Lebanese air force bases close to the border with Syria but there were no reports of casualties.
It is the deadliest violence involving Israel and Lebanon in 10 years.
The last time Beirut airport was last hit directly was on December 29, 1968 when the Israeli air force destroyed 13 planes in retaliation for Palestinian guerrilla attacks.
Israeli planes have also bombarded Hezbollah targets on the outskirts of the eastern Lebanese town of Hermel, on the border with Syria.
Israel has directly accused Syria and Iran of forming an "axis of terror" along with Hezbollah and Palestinian militant group
Hamas.
Hamas is the target of a devastating offensive in the Gaza Strip following the abduction of another Israeli soldier.
Time to “break” Hezbollah
As international concern mounted over the bloodshed, US President George W Bush said Israel had the right to defend itself.
But several European powers criticised the scale of the Israeli operation as disproportionate.
Israel Defence Minister Amir Peretz has warned that the time had come to "break" Hezbollah.
"There will be no more restraints on creating tools in order to hit, in the most decisive way, this organisation which has violated all the rules and wants to lead the Middle East into an abyss," Mr Peretz said.
Israel's army chief Dan Halutz declared that no targets in Lebanon were immune from attack. "Nothing is safe. It is as simple as that," General Halutz said.
The Israeli assault has been called "disproportionate" by UN Security Council members Russia and France as well as the European Union.
The assault has opened up a dangerous new front in the Israeli-Arab conflict following Israel's massive offensive against Gaza.
UN chief “alarmed”
UN chief Kofi Annan's personal representative to Lebanon, Gier Pederson, said he was "highly alarmed by Israel's heavy attacks and escalation" and the Arab League has called an emergency meeting for Saturday.
The UN said Mr Annan was sending a team of envoys to the region in a bid to help defuse the growing crisis but Palestinian leader Mahmud Abbas warned of the risk of "regional war."
Mr Bush has defended the military action but also expressed concern about the stability of the government led by anti-Syrian Prime Minister Fuad Siniora.
"My biggest concern is whether or not actions taken will weaken the Siniora government," he said on a visit to Germany.
Mr Bush also said Syria's President Bashar al-Assad should be held to account over the escalation of violence.
Israeli foreign ministry official Gideon Meir also said that the government had "specific information" that Hezbollah planned to transfer the soldiers to Iran, an allegation swiftly denied by Tehran.
In response to the Israeli incursion into Lebanon there has been a series of rocket attacks on Haifa, about 40 kilometres from the Lebanese border.
The rocket attacks left three people dead and wounded more than 50 civilians in northern Israel. Hezbollah denied firing rockets on Haifa.
But Israel has held Lebanon responsible. "Lebanon is a sovereign state which is responsible for any attack launched from its territory," said Israeli army spokesman Jacob Dallal.
About half a million Israelis in northern towns, including Haifa, have been ordered to enter bomb shelters and reinforced rooms.
The latest crisis was sparked by the killing of eight soldiers and the capture of another two by Hezbollah militants on Wednesday.
Thousands of Arab nationals, the main source of tourism in Lebanon, fled the country for Syria while the local stock market plunged by 10 percent.
Hezbollah, the Party of God, which was instrumental in forcing the Israeli troops out of Lebanon in 2000, has said it was seeking the release of Arab prisoners in return for the soldiers.