The IDF on Monday released declassified photos showing how Hamas uses hospitals, mosques, and playgrounds as rocket launch sites.
The images were taken from the northeastern Gaza City neighborhood of Shejaia, which was the scene of heavy fighting in recent days.
Israel's army said it had been targeting militants in the clashes, charging that they had fired rockets from Shejaia and built tunnels and command centers there. The army said it had warned civilians to leave two days earlier.
Sounds of explosions rocked Gaza City through the morning, with residents reporting heavy fighting in Shejaia and the adjacent Zeitoun neighborhood. Locals also said there was heavy shelling in Beit Hanoun, in the northern Gaza Strip.
"It seems we are heading towards a massacre in Beit Hanoun. They drove us out of our houses with their fire. We carried our kids and ran away," said Abu Ahmed, he did not want to give his full name for fear of Israeli reprisals.
The Islamist group Hamas and its allies fired multiple missiles across southern and central Israel, and heavy fighting was reported in the north and east of Gaza.
Non-stop attacks lifted the Palestinian death toll to 496, including almost 100 children, since fighting started on July 8, Gaza health officials said. Israel says 18 of its soldiers have also died along with two civilians.
Despite worldwide calls for a cessation of the worst bout of Palestinian-Israeli violence for more than five years, Israeli ministers ruled out any swift truce.
"This is not the time to talk of a ceasefire," said Gilad Erdan, communications minister and a member of Israeli Prime Minister Benjamin Netanyahu's inner security cabinet.