Israeli aircraft have dropped leaflets on the Gaza Strip telling the enclave’s 1.7 million residents to stay away from militant groups – in what is being seen as a warning of widespread air strikes.
The move comes after Hamas fighters launched 25 missiles, among them rockets and mortars, into Israeli territory.
The tit-for-tat exchange has been continuous for almost a week. It was briefly suspended after the intervention of Egypt which pressurised the Islamists, who rule Gaza, to rein-in fighters who were targeting Israel following a barrage of more than 60 projectiles in 24 hours last week.
The latest round appears to have provoked Israel’s military hierarchy into considering wider retaliation.
Buildings housing Hamas security personnel and administration buildings have been targeted in the past by Israeli air strikes.
But military sources in Israel have indicated they are reluctant to get further embroiled in a conflict with Hamas.
They recall operation Cast Lead in 2008-9 in which 1,300 Gazans were reported to have been killed, drawing international criticism of Israel.
A senior military officer involved for many years with Gaza told Sky News he did not believe Hamas was intent on provoking a major conflict with Israel.
“They have internal problems with even more radical al Qaeda linked groups which carry out operations to make Hamas look weak.
“If you look closely at what Hamas has been targeting, and they now have accurate weapons from Iran, the missiles generally fall on unpopulated areas.
“They are telling the people of Gaza that they are still leading the resistance without provoking a counter attack from us,” said one senior Israeli officer.
Nevertheless, Israelis will go to the polls in a general election on January 22.
The incumbent prime minister, Binyamin Netanyahu, is trying to forge an alliance with the far-right wing Yisrael Beiteinu leader Avigdor Lieberman – and may feel that a large-scale military incursion into Gaza is an electoral necessity.
Mr Netanyahu’s Likud party is split over whether it should enter an alliance with Mr Lieberman, who favours the forcible transfer of some Israeli Arabs to Palestinian control as part of a future peace deal.
The latest round of violence in Gaza included Israeli air strikes on alleged Hamas training areas and a Hamas rocket launching team.
They are against a background of a potentially wider conflict with Iran.
Mr Netanyahu has warned that Iran will be capable of producing a nuclear weapon by the spring of next year – implying Israel and its allies have until then to launch military strikes to stop the programme.
Iran remains defiant. It has insisted it has no nuclear weapons ambitions but that it is closing the technology gap with its rivals.
Iran holds pictures of Israeli bases and other restricted areas obtained from a drone launched into Israeli airspace earlier this month, an Iranian lawmaker was quoted as saying on Monday.
Earlier this month, the Israel Defence Forces shot down a drone after it flew 25 miles (55km) into Israel. Lebanese militant group Hizbollah claimed responsibility for the aircraft, saying its parts had been manufactured in Iran and assembled in Lebanon.
The drone transmitted pictures of Israel’s “sensitive bases” before it was shot down, said Esmail Kowsari, chair of parliament’s defence committee, according to Iran’s Mehr news agency.