Both Palestinian and Israeli families have been burying their dead in a recent upsurge in cross- border violence.
Attempts by Egypt to broker a ceasefire appear to have failed after rocket fire from Gaza and Israeli aircraft attacks.
Ten Palestinians and one Israeli have been killed in the last five days.
Islamic Jihad, which said it was behind the rocket strikes against Israel, later welcomed Cairo’s efforts to negotiate a truce.
But Israel’s Prime Minister Benjamin Netanyahu told his cabinet no such truce was in operation.
“I promise the other side will pay a heavier price than it has so far, until it stops shooting. There is no ceasefire,” he said. “The Israeli Defence Forces will protect the residents of southern Israel and eliminate the rocket launchers.”
Israeli military released a video said to show two men carrying a rocket before preparing to launch it.
Israel claims arsenals in Gaza have been boosted by gun-running from Libya since the fall of its leader.