The IDF was massing forces late Wednesday night near the Erez Crossing, gearing up for a large-scale incursion into northern Gaza to push Kassam rockets out of the range of Israeli cities.
A senior government source said Israel had no intention of reoccupying any part of Gaza, and that the intention was to be more active inside the Strip, creating a "rolling buffer zone" which would make it possible to be "more operational in the area."
IDF officers said the buffer zone might be created on the remains of three settlements - Elei Sinai, Nisanit and Dugit - evacuated during last summer's disengagement.
The idea behind the buffer zone, the sources said, was to take Ashkelon and Sderot out of Kassam rocket range and to command control over Beit Hanun, the city from which many of the recent Kassam attacks have originated.
Senior officials in the Prime Minister's Office, however, would not confirm that a decision had been made to carve out a "buffer zone," even if only a temporary one.
AP reported that IDF tanks and armored personnel carriers entered Nisanit in the northern Gaza Strip late Wednesday night. Palestinian sources said that five Israeli tanks followed by armored personnel carriers were making their way very slowly into the abandoned settlement. Two other tanks took up positions on a nearby hill as bulldozers built sand embankments around them. The IDF denied the reports.
As the soldiers assembled Wednesday night, Palestinians fired another Kassam rocket over their heads and into Ashkelon - the second time in as many days.
The IDF buildup near Erez came a day after the first Kassam rocket slammed into the heart of Ashkelon, and just a few hours after the security cabinet approved actions designed, according to a communiqu issued after their meeting, to bring "about a change in the rules of the game and in the modus operandi vis- -vis the PA and Hamas."
The cabinet authorized Prime Minister Ehud Olmert and Defense Minister Amir Peretz to "instruct the security establishment to continue its preparations for prolonged and graduated security activity" and to carry out the following actions:
â€¢ Striking at Hamas in the Gaza Strip and in Judea and Samaria, with emphasis on hitting institutions and infrastructures that serve terrorism.
â€¢ Continuing and increasing counterterrorist operations, including those aimed at crews firing Kassam rockets.
â€¢ Reducing the "terrorists' freedom of movement" by continuing to section off the Gaza Strip.
The cabinet statement listed the goals of the current operation as "the release of abducted Cpl. Gilad Shalit and the ending of the firing of rockets and mortars from Gaza."
The security cabinet reiterated Israel's refusal to negotiate a release of Palestinian prisoners in exchange for Shalit.
Among the soldiers poised to reenter Gaza were officers from the IDF's Civil Administration, whose job would be to ensure that no humanitarian crisis erupted in the Strip during the operation. The security cabinet communiqu said that the defense establishment had been instructed to respond "comprehensively and immediately to all humanitarian needs."
Justice Minister Haim Ramon told Israel Radio after the security cabinet meeting that Jerusalem had confirmed "absolutely" that Shalit was alive and was being held captive by Hamas. Ramon added that Israel would exact a "high price" from anyone responsible for terrorist attacks.
London-based A-Sharq Al-Awsat reported that Shalit's captors had rejected mediation attempts by Egyptian President Hosni Mubarak designed to secure Shalit's release. The paper said the kidnappers were unwavering in their demand that Israel free a large number of security prisoners in exchange for the soldier.
The newspaper also reported that most Palestinian Authority government ministers had gone into hiding, that PA Prime Minister Ismail Haniyeh was not spending an extended time in any one place, and that PA Foreign Minister Mahmoud Zahar was neither sleeping at home nor going to his office.
The security cabinet also instructed Foreign Minister Tzipi Livni to continue applying diplomatic pressure on the Syrian leadership through the international community to secure Shalit's release.
IDF sources said the forces poised near the Erez crossing would take up positions on the outskirts of Beit Hanun. Earlier in the day, semitrailers picked up armored vehicles parked outside Kibbutz Mefalsim southwest of Sderot and began bringing them to Erez for the planned incursion.
Before dawn Wednesday, the IAF struck a Hamas-run school in the northern Gaza Strip. The building, the IDF said, was a school during the day but at night turned into a meeting place for Hamas terrorists.
In other attacks, aircraft targeted the Palestinian Interior Ministry building in Gaza City for the second time in a week. Witnesses said missiles hit the main structure and damaged a building next to the ministry.
Rescue workers said five people were wounded. The two top floors of the main building collapsed, and the second building, which provides housing for ministry employees, was set on fire, the witnesses said.
Also on Wednesday, Cpl. Ro'i Amitai, a member of Shalit's tank crew that was attacked at Kerem Shalom on June 25, spoke on Channel 10 about Shalit. Amitai described Shalit as "quiet and introverted. If you didn't talk to him, he wouldn't talk much. He was quiet and shy, modest, and did his own thing."
Amitai said that as quiet as Shalit was, "I can see him as a strong guy. But how strong?"
Amitai said that the crew was never warned about a tunnel reaching them. "I never imagined anything like it," he said. "Never, never."
AP contributed to this report.