The Israeli Prime Minister's Office said in a statement that "the War Cabinet unanimously decided that Israel will continue its operation in Rafah in order to exert military pressure on Hamas in order to promote the release of our hostages and the other goals of the war."
Rafah, Gaza
Palestinian militant group Hamas on Monday agreed to a Gaza ceasefire proposal from mediators, but Israel said the terms did not meet its demands and pressed ahead with strikes in Rafah while planning to continue negotiations on a deal.
The developments in the seven-month-old war came as Israeli forces struck Rafah on Gaza's southern edge from the air and ground and ordered residents to leave parts of the city, which has been a refuge for more than a million displaced Palestinians.
Hamas said in a brief statement that its chief, Ismail Haniyeh, had informed Qatari and Egyptian mediators that the group accepted their proposal for a ceasefire.
Israeli Prime Minister Benjamin Netanyahu's office said later that Hamas' latest truce proposal falls short of Israel's demands but Israel would send a delegation to meet with negotiators to try to reach an agreement.
In a statement, Netanyahu's office added that his war cabinet approved continuing an operation in Rafah.
"The war cabinet unanimously decided that Israel continue the operation in Rafah to exert military pressure on Hamas in order to advance the release of our hostages and the other goals of the war," the statement said.
An Israeli official, speaking on condition of anonymity said the proposal that Hamas accepted was a watered-down version of an Egyptian offer and included elements that Israel could not accept.
"This would appear to be a ruse intended to make Israel look like the side refusing a deal," said the Israeli official, who spoke on condition of anonymity.
Any truce would be the first pause in fighting since a week-long ceasefire in November, during which Hamas freed around half of the hostages.
Since then, all efforts to reach a new truce have foundered over Hamas' refusal to free more hostages without a promise of a permanent end to the conflict, and Israel's insistence that it would discuss only a temporary pause.
Earlier on Monday, Israel ordered the evacuation of parts of Rafah, the city on the Egyptian bordered that has served as the last sanctuary for around half of Gaza's 2.3 million residents.
By Mohammed Salem, Nidal al-Mughrabi and Ari Rabinovitch
An apparent drone attack - claimed by the Iranian-backed Houthi militia - hit central Tel Aviv in the early hours of Friday, killing one man and slightly wounding four others, the Israeli military and emergency services said.
Israeli Defense Minister Yoav Gallant told his U.S. counterpart that military operations in the Gaza Strip have created conditions that would enable a hostage deal to be reached, Gallant's office said on Wednesday.
A meeting of the United Nations Security Council on the Middle East was briefly interrupted on Wednesday when two protesters stood with signs and yelled for the release of Israeli hostages held by Palestinian militants Hamas in the Gaza Strip.
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