Palestinian militant groups in the Gaza Strip announced an Egyptian-brokered ceasefire with Israel on Tuesday after a severe escalation of violence threatened to descend into full-blown war.

The groups, including Hamas, issued a joint statement saying they would abide by the ceasefire as long as Israel did the same.

Israeli Prime Minister Benjamin Netanyahu's office and the military had not commented on the announcement.

Israel's hardline defence minister, Avigdor Lieberman, issued a statement saying he did not support stopping the strikes.

“Egypt's efforts have been able to achieve a ceasefire between the resistance and the Zionist enemy,” the statement by the Gaza groups said.

“The resistance will respect this declaration as long as the Zionist enemy respects it.”

Kuwait and Bolivia meanwhile requested an urgent closed-door meeting later on Tuesday of the UN Security Council to discuss the violence, diplomats said.

The violent escalation between Israel and Palestinian militants in Gaza was the worst since a 2014 war.

Seven Palestinians were killed in Gaza over the course of some 24 hours as Israeli strikes targeted militants and flattened buildings while sending fireballs and plumes of smoke into the sky.

Sirens wailed in southern Israel and tens of thousands of residents had taken cover in shelters as around 460 rockets and mortar rounds were fired from the Gaza Strip, wounding 27 people, including three severely.

A Palestinian labourer from the occupied West Bank was killed when a rocket hit a building in the Israeli city of Ashkelon.

'Restraint must be shown'

Schools were closed in the Gaza Strip and in southern Israel as both sides warned the other that it would respond forcefully to any further violence.

Egypt has negotiated ceasefires following previous flare-ups, while UN Middle East envoy Nickolay Mladenov has also been seeking a long-term truce between the two sides in recent weeks.

Mladenov had earlier called the escalation “extremely dangerous” and said on Twitter that “restraint must be shown by all”.

After an Israeli security cabinet meeting that reportedly lasted some six hours on Tuesday, a statement was issued saying the ministers “instructed the (military) to continue its operations as necessary”.

Netanyahu had cut short a visit to Paris as tensions rose and arrived back home on Monday.

The latest round of violence began on Sunday with a botched Israeli special forces operation inside the Gaza Strip that turned deadly and prompted Hamas to vow revenge.

The clash that resulted from the blown covert operation killed seven Palestinian militants, including a local Hamas military commander, as well as an Israeli army officer.

Palestinian militants responded with rocket and mortar fire, as well as an anti-tank missile that hit a bus that Hamas says was being used by Israeli soldiers. A soldier was severely wounded in the attack.

'Like an earthquake'

Missile defences intercepted more than 100 rockets from Gaza and most others fell in open areas, though some hit houses and other civilian structures.

“Within two seconds (after air sirens) we heard a huge boom, we saw our curtains flying in the air, windows (broken), and only after a few minutes when we went out, we realised that the missile had hit the building next to us,” said Claude Bonfito, who lives near an block of flats hit by a rocket in the Israeli city of Ashkelon.

Israel hit back with major air strikes, with targets including Hamas's Al-Aqsa TV station and internal security headquarters in Gaza City.

The military said it struck some 160 targets in the Gaza Strip.

“What happened was like an earthquake,” said Abu Ayman Lemzeni, who lives near the destroyed TV building.

At least five of the dead in Gaza were claimed as members of various militant groups. Some 26 other people were wounded in the Palestinian territory, according to Gaza's health ministry.

Three wars

The escalation came despite Netanyahu's decision to allow Qatar to transfer millions of dollars in aid to the Gaza Strip for salaries as well as fuel to ease an electricity shortage.

The agreements had led to calmer protests along the Gaza border after months of deadly unrest.

Sunday's special forces operation and resulting clash upset those efforts, leading to questions over the timing of the covert Israeli move.

Israel said it was an intelligence-gathering operation and that those efforts must continue to defend the country.

Israel and Palestinian militants in Gaza have fought three wars since 2008, and protests and clashes along the Gaza border since March 30 have repeatedly raised fears of a fourth.

At least 234 Palestinians in Gaza have since been killed by Israeli fire, the majority during protests and clashes.

Two Israeli soldiers have been killed over the same period.