The bloodiest day in 13 days of conflict prompted urgent efforts by the International Committee of the Red Cross to broker a temporary ceasefire to allow evacuation of the dead and wounded in a deal accepted by both Israel and Hamas.
However, the humanitarian ceasefire was short-lived as the Israeli army accused Hamas militants of violating it and said it had "responded accordingly".
Hundreds of Palestinians fled in panic into Gaza City today as Israeli troops focused their firepower on the nearby town of Shaja'ia.
Of the 425 Palestinians killed since the start of Israel's Operation Protective Edge, 112 were minors, 41 women and 25 elderly people, emergency services spokesman Ashraf al-Qudra said.
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Over 2,500 people have been injured and almost 61,000 displaced seeking refuge in 49 UN Relief and Works Agency run centres, sources in the Gaza Strip said.
There were reports of multiple deaths in Israeli attacks on Shejaiya and the neighbouring Zeitun district, as well as in Jabaliya to the north. The streets of Shejaiya were filled with thousands of people fleeing for their lives.
Seven Israelis, including five soldiers, have been killed in the fighting and dozens others injured while a large section of the Israeli population struggles to carry out normal life under attack, trying to stay put close to safe shelters under instructions from the Home Front.
One of the militants was also killed on Israeli soil while the rest fled back to Gaza and were killed by a helicopter gunship.
Palestinians have released gruesome images of the dead and wounded, including children, who were killed overnight in the massive IDF attack in the area.