Updated 09.51
Palestinian health officials say 204 people are now dead in Gaza as a result of Israeli airstrikes. Israel says its defending itself against Hamas rocket attacks, and one person has died there so far.
Overnight, tens of thousands of people in northern and eastern Gaza were warned to leave their homes amid warnings that the campaign would intensify.
Israel's military has urged tens of thousands of Palestinians living in northern and eastern Gaza to leave their homes.
The move could signal more airstrikes are planned for those areas after Israel warned the ruling Hamas militant group would "pay the price" for rejecting a ceasefire plan.
Israel says it will "expand and intensify" its offensive as aerial assaults resumed on Tuesday after being briefly suspended following its acceptance of the Egypt-brokered truce.
Palestinian militants fired dozens of rockets in the first six hours of the ceasefire plan which led to Israel restarting its strikes in Gaza - that has a population of 1.7 million.
The fresh raids hit Gaza City, southern Khan Younis, Rafah and central Johr al Deeq, killing five people, reported the AFP news agency.
Israel has confirmed its first death of the week-long conflict - a man who was delivering food to soldiers suffered fatal wounds when a Hamas rocket struck the Erez crossing on the Gaza border.
The Israeli military has told residents of the northern Gaza town of Beit Lahiya and the Gaza City neighbourhoods of Shijaiyah and Zeitoun in automated telephone calls to leave their properties.
The Israeli army have released this video - claiming to show them calling off airstrikes where civilians are present in Gaza
Sami Wadiya, a resident of one of the areas likely to be targeted, said he would not leave his home. "We know it's risky, but there are no secure places to go to".
Prior to the calls, the raids have already prompted around 17,000 people to flee their homes, particularly in northern Gaza, with many taking refuge in UN schools.
The United Nations Relief and Works Agency for Palestine Refugees (UNRWA) has declared an emergency in all five areas of the Gaza Strip.
It says that the situation on the ground over the past 24 hours has remained intense.
"Close to 18,000 women, men and children spent the night in 21 UNRWA designated emergency shelters. Approximately 10,800 people have taken shelter in 16 UNRWA schools in Gaza City and about 7,000 in 5 shelters in northern Gaza" it adds.
These children are among the 18,000 people sheltering at UN centres in Gaza
Hamas officials said they had not been consulted on the ceasefire proposal and would not halt violence without a fully-fledged deal including Israeli concessions.
More than 190 Palestinians, including many civilians - some children - have been killed by the bombardment over the last week and the Israelis say the raids are designed to stop rocket fire from Gaza.
Since July 8th, Gaza militants have fired more than 1,200 rockets at Israel - hundreds of which have been intercepted by the Iron Dome air defence system - while Israeli aircraft have struck close to 1,700 times.
Prime Minister Benjamin Netanyahu said "It would have been preferable to have solved this diplomatically, and this is what we tried to do when we accepted the Egyptian proposal for a ceasefire".
"But Hamas leaves us no choice but to expand and intensify the campaign against it".
He added "Hamas chose to continue fighting and will pay the price for that decision. When there is no ceasefire, our answer is fire".
Hamas spokesman Sami Abu Zuhri said the movement had not been consulted on the truce bid.
"We didn't get to see the Egyptian proposal except through the media" he said.
"The idea of halting fire before there is any agreement on the conditions laid out by the resistance is unacceptable and we reject it".
Hamas has said it wants the end of Israel's blockade of Gaza and the opening of the Rafah border crossing with Egypt as part of a truce deal. It also wants Israel to free Palestinians it re-arrested after releasing them in a 2011 exchange for an Israeli soldier held by Gaza militants for more than five years.
Kim Sengupta from the London Independent is in Gaza. He told Newstalk Breakfast that there was confusion amongst officials there about the proposed ceasefire that failed yesterday.
