Israel's war on Gaza continued as world leaders awaited Israel's reaction but urged de-escalation after Iran's unprecedented retaliatory attack that heightened fears of wider conflict.
World powers have called for restraint after Iran launched more than 300 drones and missiles at Israel late on Saturday, though the Israeli military has said nearly all were intercepted.
Tehran's first direct assault on Israel, in retaliation for a deadly Israeli strike on its Damascus embassy consular annex on 1 April, followed months of tensions across the region involving Iranian proxies and allies who say they act in support of Palestinians in the Gaza Strip.
Israel's war cabinet discussed a range of options at a meeting on Monday, with the intention of hurting Iran for its attack but without causing an all-out war, Israel's Channel 12 news reported.
In an unsourced report, the broadcaster said Israel's intention was to embark on action coordinated with the United States, which has said it would not join Israel in any direct attack on Iran.
Iranian President Ebrahim Raisi has warned that a "reckless" Israeli move would spark a "much stronger response".
Tehran has insisted the attack on Israel was an act of "self-defence" after the Damascus strike that killed seven Revolutionary Guards including two generals.
Attention has also turned to Israel's top ally, the United States, which played a key role in shooting down the Iranian drones.
While US President Joe Biden has been increasingly critical of the civilian death toll in Gaza, after the Iran attack he reaffirmed Washington's "ironclad" support for Israel.
But Biden has been pushing for caution from Israel, telling Netanyahu that the White House would not offer military support for any retaliation against Iran, according to a senior US official.
The Israeli military said it would not be distracted from Gaza.
"Even while under attack from Iran, we have not lost sight… of our critical mission in Gaza to rescue our hostages from the hands of Iran's proxy Hamas," military spokesman Rear Admiral Daniel Hagari said late on Sunday.
Israel estimates that 129 hostages, including 34 presumed dead, are still held in Gaza since a Hamas-led attack into Israeli territory on 7 October.
The Gaza government media office said Israeli aircraft and tanks launched "dozens" of strikes overnight in the centre of the strip, reporting several casualties.
Witnesses told AFP that strikes hit the Nuseirat refugee camp, with fighting also reported in other areas of central and northern Gaza.
Israel's war on Gaza has killed at least 33,797 people, mostly women and children, according to the territory's health ministry. The toll rose by at least 68 deaths over 24 hours.
The International Court of Justice in January said that Israel was plausibly breaching the UN Genocide Convention in Gaza.
Israel released around 150 detainees on Monday who had been rounded up in Gaza, the territory's crossings authority told AFP.
The 7 October attack resulted in the deaths of 1,170 people, mostly civilians, according to Israeli figures.
Lebanon's Iran-backed Hezbollah group, which has had near-daily cross-border clashes with Israel since the war broke out, claimed an overnight attack on Israeli soldiers who had crossed into Lebanese territory.
The Israeli army confirmed that four of its troops were wounded in an explosion while inside Lebanon.
'On the brink' of war
The United Nations Security Council held an emergency meeting on Sunday following the Iranian attack, where Secretary-General António Guterres warned the region was "on the brink" of war.
"Now is the time to defuse and de-escalate," Guterres said.
The UK and Germany were among those also calling for de-escalation on Monday, while French President Emmanuel Macron said his government would help do everything it could to avoid a "conflagration" in the Middle East.
A United States official said the hope was that "in the light of day" Israel would see it had won a "spectacular success" against Iran's attack, which resulted in no reported deaths.
However, Middle East analyst James Ryan said he feared the "status quo will be short-lived".
"I expect Biden to attempt to restrain Israeli responses, but Netanyahu has already shown a willingness to test any kind of limit Biden wishes to impose," he said.
Ahead of Iran's attack, Israel closed schools and announced restrictions on public gatherings. But the army said on Monday that those measures were being lifted for most of the country.
In Iran, airports in the capital and elsewhere reopened on Monday, state media said.
World oil prices sank as traders bet on a de-escalation of tensions.
More than six months of Israel's war have led to dire humanitarian conditions in the besieged Gaza Strip, which the UN has warned faces imminent famine.
Rumours of a reopened Israeli checkpoint on the coastal road from the territory's south to Gaza City sent thousands of Palestinians heading north on Sunday, despite Israel denying it was open.
Attempting the journey back to northern Gaza, displaced resident Basma Salman said: "Even if it [my house] was destroyed, I want to go there. I couldn't stay in the south.
"It's overcrowded. We couldn't even take a fresh breath of air there. It was completely terrible."
In the southern Gaza city of Khan Younis, civil defence teams said they had retrieved at least 18 bodies from under the rubble of destroyed buildings.
Responding late on Saturday to the latest truce plan presented by US, Qatari, and Egyptian mediators, Hamas said it insists on "a permanent ceasefire" and the withdrawal of Israeli forces from Gaza.
Israel called this a "rejection" of the proposal, but the US said mediation efforts continue.
(AFP, Reuters)