After a brief pause allowing food and fuel into Gaza, Israeli airstrikes and Hamas rockets resumed.
The Israeli government has tentatively welcomed a cease-fire proposal from Egypt and France but has however been instructed by military to continue its assault on Hamas.
An Israeli warplane dropped leaflets in Gaza urging some residents to flee because of imminent attacks.
The cease fire proposal could mark the beginning of the end to the loss of lives in Gaza, but with the renewed fighting, a truce deal still seems once again distant.
Israel says it needs guarantees that any cease-fire will halt rocket fire and prevent Hamas from rearming, while Hamas demands that Gaza's blockaded border crossings be opened.
Israeli strikes in response to continued Hamas rocket fire on southern Israel have killed at least 688 Palestinians since Dec. 27, including around 350 civilians, among them 130 children, according to Palestinian officials.
Israel says it has killed at least 130 Gaza militants since it launched its ground offensive Saturday. Ten Israelis have been killed since the fighting began, including three civilians.
On Wednesday, 29 Palestinians were killed, including at least 22 civilians and two Islamic Jihad militants, medics said. In one incident, a family of four was killed in an airstrike on their car, medics said.
In the Jebaliya refugee camp, there was a mass funeral for 40 people killed Tuesday by Israeli mortar fire toward a U.N. school. Israel said it was responding to an attack by Hamas militants who fired mortar shells from an area near the school.
The bodies, wrapped in blankets, were laid out in a long row on the ground, with mourners kneeling in prayer before them.