The US and UN have condemned the shelling of a school housing displaced civilians in Gaza.
UN Secretary-General Ban Ki-moon said the attack, which killed 16, was “outrageous”. Israel said that its military was responding to mortar rounds launched from near the school.
More than 100 people died in Gaza on Wednesday, Palestinian officials said, as the shelling of a market near Gaza City killed 17, while booby traps claimed the lives of three Israeli soldiers.
Palestinian doctors said an Israeli air strike had also killed seven people in Khan Younis.
The Gaza health ministry said 106 people had been killed on Wednesday, bringing the overall death toll to 1,336. Most have been civilians.
Some 58 Israelis have been killed, 56 soldiers and two civilians. A Thai worker in Israel has also died.
The UN expressed outrage at the attack on the school in the Jabaliya refugee camp.
Spokesman Chris Gunness told the BBC that Israel had been told 17 times that the school was housing displaced people, saying the attack caused “universal shame”.
Ban later said: “I condemn this attack in the strongest possible terms. It is outrageous. It is unjustifiable, and it demands accountability and justice. Nothing is more shameful than attacking sleeping children.”
More than 3,000 civilians had sought shelter at the school.
Deputy Secretary-General Jan Eliasson said: “This is a moment where you really have to say: ‘Enough is enough.'”
Bernadette Meehan, the spokeswoman of the US National Security Council, also condemned the shelling of the school.
She said: “We are extremely concerned that thousands of internally displaced Palestinians who have been called on by the Israeli military to evacuate their homes are not safe in UN designated shelters in Gaza.”
Ms Meehan also condemned “those responsible for hiding weapons in United Nations facilities in Gaza”.
Israel has regularly accused Hamas, which controls Gaza, of hiding weapons in such facilities.
The Israeli military said in a statement that its “initial inquiry suggests militants fired mortars… from the vicinity of the school in Jabaliya”.
It said soldiers had “responded by firing towards the origin of fire”.
Both Mr Ban and Ms Meehan called for a speedy ceasefire, as did UK Foreign Secretary Phillip Hammond, who said the situation in Gaza was “a humanitarian catastrophe”.
The attack on the market in Shejaiya killed 17 people and wounded 160 as hundreds tried to buy fruit and vegetables, the Palestinian health ministry said.
A journalist who worked for a local news agency was reported to have been killed.
One witness, Salim Qadoum, told Associated Press: “The area is like a bloodbath, everyone is wounded or killed. People lost their limbs and were screaming for help. It’s a massacre.”
Ban called the attack “unconscionable”.
The attack there and in Khan Younis came during a four-hour humanitarian ceasefire called by the Israelis after the school attack.
However, Israel said the truce was only partial and applied to areas where Israeli soldiers were not currently operating. It told residents not to return to areas they had previously been asked to evacuate.
Hamas had rejected the truce as meaningless and “media exploitation”.
Israel said rockets continued to be fired from Gaza, with more than 50 launched on Wednesday.
Israel launched its offensive in Gaza after a surge in rocket fire from the territory and it says one of its main objectives is to destroy tunnels used by militants to infiltrate Israel.
Army spokesman Sami Turgeman said on Wednesday that this mission “will be completed within a number of days”.
Recent opinion polls in Israel show strong support for the military operation. Hamas says it will not stop fighting until a blockade, maintained by both Israel and Egypt, is lifted.
The current conflict, now in its 23rd day, is the longest between Israel and militants from Gaza.