Israel has been shelling Gaza from the sea and air for a fifth day as Prime Minister Benjamin Netanyahu said Israel is ready to "significantly expand" its operation in Gaza.
Rockets from Gaza have again landed in Israel. One rocket caused damage and injuries in the city of Ashkelon.
In Gaza, two media buildings were hit and eight Palestinian journalists hurt.
Sources on both sides have confirmed to the BBC that attempts to reach a ceasefire are continuing.
UK Foreign Secretary William Hague warned that a ground invasion would cost Israel international support.
Speaking to Sky News, Mr Hague said the Hamas movement which governs Gaza bears "principal responsibility" for the current conflict.
"The Prime Minister and I have both stressed to our Israeli counterparts that a ground invasion of Gaza would lose Israel a lot of the international support and sympathy they have in this situation," he said.
At least six people were killed in Gaza on Sunday, doctors said - including two children from the same family.
'Prepared for expansion'At the scene
I live in a residential area close to lots of Hamas security buildings - the interior ministry is only 200m from my house - and we can hear bombings very close.
When Israel targets Hamas, civilians are always caught up in the cross-fire, and shelling from the sea is less accurate than aerial missile strikes.
People are exhausted after five days of bombing day and night.
Gaza has turned into a ghost city. Travelling during the night is very dangerous because Israeli drones are flying overhead.
Businesses, schools and universities are closed. The only people you find travelling around are ambulance drivers and journalists. People are only going out to buy food and fuel.
Israeli soldiers were ready "for any activity that could take place," Mr Netanyahu said at a cabinet meeting on Sunday.
"We are exacting a heavy price from Hamas and the terrorist organisations and the Israel Defense Forces are prepared for a significant expansion of the operation," he said.
The Israeli military confirmed to the BBC that it knew foreign journalists were in at least one of the two media buildings it struck in Gaza, but said they were not the target.
All the sites hit overnight were "positively identified by precise intelligence over the course of months", it said on Twitter.
One of the injured Palestinian journalists had to have a leg amputated.
The Middle East Foreign Press Association has issued a statement expressing concern at the air strikes on the media buildings.
Among those using the buildings were a Hamas television channel, al-Quds TV, as well as Sky News and ITN. The BBC had its offices in one of the buildings until last year.
The Israeli military has said it was "targeting antennas" on buildings "being used by Hamas to communicate with its forces in the field".
Sirens sounded in Tel Aviv, Israel's commercial capital, on Sunday for the fourth day running. Two rockets fired from Gaza were intercepted and destroyed by the Iron Dome missile shield, police say.
However, a rocket from Gaza made a direct hit on a residential building in Ashkelon, 16km (10 miles) to the north, causing injuries and damage.
Health officials in Gaza say at least 52 Palestinians - including 11 children - have been killed since Israel launched Operation Pillar of Defence on Wednesday with an air strike that killed Hamas military chief Ahmed Jabari.
"Start Quote
End QuoteIt has taken a psychological adjustment for locals to realise that they too are now within the firing range of certain Palestinian rockets"
Three Israelis were killed on Thursday.
At about 02:00 (00:00 GMT) on Sunday, the BBC's Jon Donnison in Gaza City reported hearing more than a dozen shells, apparently fired from Israeli warships.
Artillery fire is generally less accurate than air strikes, which were also heard across Gaza City throughout the night and into Sunday.
Hospitals short on suppliesThe World Health Organisation says hospitals in Gaza are overwhelmed with casualties and short on supplies.
Israel opened one of the main goods crossings into Gaza on Sunday to allow in several truck loads of medical supplies and other emergency equipment.
Egyptian President Mohammed Mursi said an Israeli ground invasion would have "serious repercussions", saying Egypt would never accept it "and neither will the free world".
Israel has put 75,000 reservists on stand-by.
The Arab League, which met in emergency session in Cairo, announced it would send a delegation to Gaza in the next few days.
On Saturday, Israeli Prime Minister Benjamin Netanyahu spoke to German Chancellor Angela Merkel, who emphasised Israel's right to self-defence, a spokesman for Mrs Merkel said.
She agreed with Mr Netanyahu on the need for a comprehensive ceasefire as soon as possible to prevent further bloodshed, the spokesman said.
'Back to the Middle Ages'Interior Minister Eli Yishai was quoted by Israel's Haaretz newspaper as saying that the goal of the operation was "to send Gaza back to the Middle Ages. Only then will Israel be calm for 40 years".
Before the recent offensive, Israel had repeatedly carried out air strikes on Gaza as Palestinian militants fired rockets across the border.
But the aerial and naval bombardment is its most intense assault on the coastal territory since it launched a full-scale invasion four years ago.
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