Netanyahu made the announcement shortly after Israel said that Hamas had opened fire on IDF forces in southern Gaza.
Israel's Prime Minister Benjamin Netanyahu ordered the army on Tuesday to immediately carry out "powerful strikes" in Gaza, a new test for the tenuous US-brokered ceasefire.
Eyewitnesses in Gaza City said Israeli military planes had begun launching air strikes, while tanks firing and explosions were reported in other parts of the Strip.
The order from Netanyahu follows heightened tensions, as Israel reported Hamas firing on its forces in southern Gaza and after Hamas returned a set of remains that Israel said belonged to a hostage recovered earlier in the war.
Netanyahu called the return a "clear violation" of the ceasefire agreement, which requires Hamas to return all Israeli hostage remains as soon as possible.
In a sign of the fragility of the ceasefire, Israeli troops were shot at in the southern city of Rafah on Tuesday and returned fire, according to an Israeli military official who spoke on condition of anonymity because there hasn't been an official announcement yet.
There are still 13 bodies of hostages in Gaza. Hamas said on Tuesday it had recovered the body of a hostage, but after Israel announced the plans to strike Gaza, the group said it would delay the handover.
An Associated Press videographer in Khan Younis witnessed what appeared to be a white body bag being carried out from a tunnel by several men, including some masked militants, and then transported into an ambulance. It was not immediately clear what was in the bag.
The slow return of hostages' bodies is posing a challenge to implementing the next stages of the ceasefire, which will address even tougher issues, such as the disarmament of Hamas, the deployment of an international security force in Gaza and deciding who will govern the territory.
Hamas has said it is struggling to locate the bodies amid the vast destruction in Gaza, while Israel has accused the militant group of purposely delaying their return.
Over the weekend, Egypt deployed a team of experts and heavy equipment to help search for the bodies of the remaining hostages. That work continued in Khan Younis and Nuseirat on Tuesday.
This is the second time since the ceasefire began on 10 October that remains turned over by Hamas have been problematic.
Israel said one of the bodies Hamas released in the first week of the ceasefire belonged to an unidentified Palestinian.
During a previous ceasefire in February, Hamas said it handed over the bodies of three hostages, Shiri Bibas and her two sons, but testing showed that one of the bodies returned was identified as a Palestinian woman. Shiri Bibas’ body was returned a day later.