Israel has sent tanks into eastern Jabalia in the northern Gaza Strip after a night of heavy aerial and ground bombardments, killing 19 people and wounding dozens of others, health officials say.
The death toll in Israel's military operation in Gaza has now passed at least 35,000 Palestinians, according to Gaza's health ministry.
The bombardment has laid waste to the coastal enclave and caused a deep humanitarian crisis.
The war was triggered by a Hamas-led attack on southern Israel on October 7 in which some 1200 people were killed and more than 250 people taken hostage, according to Israeli tallies.
Israel says 620 soldiers have been killed in the fighting.
Jabalia, the biggest of Gaza's eight historic refugee camps, is home to more than 100,000 people.
Most of them are descendants of Palestinians who were driven from towns and villages in what is now Israel during the 1948 Arab-Israeli war that led to the creation of the state of Israel.
Late on Saturday, the Israeli military said forces operating in Jabalia were preventing Hamas, which controls Gaza, from re-establishing its military capabilities there.
"We identified in the past weeks attempts by Hamas to rehabilitate its military capabilities in Jabalia," said Rear Admiral Daniel Hagari, Israel's military spokesman, during a briefing to reporters.
"We are operating there to eliminate those attempts."
Hagari said Israeli forces operating in Gaza City's Zeitoun district killed about 30 Palestinian militants.
"Bombardment from the air and ground hasn't stopped since yesterday - they were bombing everywhere including near schools that are housing people who lost their houses," said Saed, 45, a resident of Jabalia.
"War is restarting - this is how it looks in Jabalia," he told Reuters via a chat app.
"The new incursion forces many families to evacuate."
The army sent tanks back into Al-Zeitoun, an eastern suburb of Gaza City, as well as Al-Sabra, where residents also reported heavy bombardments that destroyed several houses including high-rise residential buildings.
The army had claimed to have gained control of most of these areas months ago.
The Israeli Defence Forces said air sirens had sounded in the southern Kerem Shalom area and it had successfully intercepted two rockets launched from the vicinity of Rafah.
It said there were no injuries and no damage reported.
Later on Sunday, sirens sounded in the Israeli city of Ashkelon as a result of incoming rocket fire from Gaza, which signalled militants there were still able to launch rocket attacks after more than seven months of war.
Tanks did not invade eastern Deir Al-Balah city, residents and Hamas media said, but some Israeli tanks and bulldozers penetrated the fence on the outskirts of the city prompting a gunfight with Hamas fighters.
In an air strike late on Saturday in Deir Al-Balah two doctors, a father and his son, were killed, health officials said.
The armed wing of Hamas and the Islamic Jihad said their fighters attacked Israeli forces in several areas inside Gaza with anti-tank rockets and mortar bombs, including in Rafah.
Rafah, where more than one million people were sheltering, was previously the Palestinians' last refuge.
The Palestinian Telecommunication company said internet services in southern areas of the enclave were severed because of the ongoing "aggression", adding that workers were seeking to resolve the problem.
On Sunday, more families, estimated in the thousands, were leaving Rafah as the Israeli military pressure intensified.
Tank shells landed across the city as the army gave evacuation orders covering some neighbourhoods in the centre of the city, which borders Egypt.
"As I moved out of Rafah, I passed through Khan Younis - I cried," said Gaza resident Tamer Al-Burai, who had been sheltering in Rafah.
"I didn't know if was I crying for what I was passing through, the humiliation and the feeling of loss I felt or for what I have seen.
"I saw a ghost city, all buildings on the two sides of the road, complete districts were wiped out.
"People are fleeing for safety, knowing there was no place safe, and there are no tents and no people to care for them," he told Reuters.
Burai said Palestinians had been abandoned by the world and left to face their destiny as the war entered its eighth month, with world powers failing to end hostilities and international mediation efforts to reach a ceasefire collapsing over Hamas and Israel disputes.
"No ceasefire, no UN decision, no hope," he said.
