"We have entered a new phase in the war. Last night the ground in Gaza shook. We attacked above ground and below ground," Gallant said in a video statement, alluding to the network of military tunnels Hamas has built under Gaza.

"The instructions to the forces are clear: the action will continue until further notice."

Late on Friday Israel stepped up its air campaign on the Gaza Strip, turning hundreds of buildings and thousands of houses into rubble.

Witnesses said most of the bombing was concentrated on areas around two hospitals -- Al-Shifa and the so-called Indonesian hospital -- located in Jabaliya district of northern Gaza.

The strikes left wide craters in the streets and flattened many buildings.

"We will continue to be strong and precise. And hunt down every terrorist," Gallant said.

The devastating conflict erupted after Hamas militants carried out a shock cross-border attack on Israel on October 7 that left 1,400 people dead, most of them civilians, according to Israeli officials.

The Islamist group has also taken some 229 people to the Gaza Strip as captives, according to the army.

In retaliatory Israeli strikes, more than 7,700 people have been killed in the Gaza Strip, including some 3,500 children, according to the territory's health ministry.