The armed wing of Hamas warned foreign airlines against flying into Tel Aviv on Wednesday and declared truce talks in Cairo over as a six-week war with Israel spirals into further bloodshed.
Israeli warplanes carried out dozens of air strikes across Gaza again on Wednesday in response to multiple rocket attacks on southern Israel, as nine days of calm exploded into bloodshed.
Several thousand furious mourners poured onto the streets of Jabaliya refugee camp to bury the wife and infant son of the top commander of Hamas's armed wing, baying for revenge.
Mohammed Deif, who has topped Israel's most wanted list for more than a decade, escaped the assassination attempt, Hamas said.
Israel, which had carried out five previous attempts on Deif's life, said its offensive in Gaza would continue until the security of Israelis was guaranteed.
At least 2,049 Palestinians and 67 people on the Israeli side have now been killed since the conflict began on July 8, more than 20 of those Palestinians since fighting resumed late Tuesday.
"We are warning international airlines and press them to stop flying into Ben Gurion airport from 6 am (0300 GMT)," the spokesman of the Hamas armed wing, Abu Obeida, said in a televised speech.
Last month, many international airlines briefly suspended flights into Tel Aviv after a Hamas rocket struck close to the airport.
Dressed in military fatigues with his face wrapped in a red-and-white chequered headscarf, Abu Obeida said Hamas was abandoning efforts to negotiate a durable ceasefire with Israel.
"We are calling on the Palestinian delegation to withdraw immediately from Cairo and not to return," he said in the speech broadcast on Hamas's Al-Aqsa TV channel.
"There will be no return to talks after today and any move in this direction will never achieve any result," he added.
Israeli Prime Minister Benjamin Netanyahu said the leaders of "terrorist organisations" are legitimate targets and warned that "no one is immune from our fire".
"Our policy is the following: if Hamas fires, we will hit back with more force and if they don't understand today, they will understand tomorrow and if not tomorrow then after tomorrow," Netanyahu said.
The fighting over the last six weeks has been the most violent confrontation between Israel and Hamas militants since the second Palestinian intifada, or uprising, from 2000-2005.
The UN says around three-quarters of the victims in Gaza have been civilians. Sixty-four of the Israeli dead were soldiers.
An Israeli air strike near Jabaliya late Wednesday killed two Palestinians, the emergency services spokesman said.
Egyptian mediators scrambled for weeks to push the warring sides to agree a decisive end to the bloodshed, but their latest attempts collapsed on Tuesday when the fighting resumed.
Several thousand angry mourners joined the funeral procession for Deif's 27-year-old wife and seven-month-old son in Jabaliya, shouting "Allahu Akbar" (God is greatest) and demanding revenge.
The mourners, firing Kalashnikovs, buried Widad and her son Ali, who died alongside another woman and a teenager when a missile slammed into a six-storey building in Gaza City late on Tuesday.
Grief-stricken, Widad's father Mustafa Harb Asfura carried his tiny grandson into the mosque then to the cemetery, his body wrapped in a white sheet exposing his white face with an injury to the eye.
"My daughter knew she would die a martyr when she decided to marry Mohammed Deif," he told AFP.
In Israel, Interior Minister Gideon Saar justified the attack, calling Deif a legitimate target.
"Mohammed Deif deserves to die just like (the late Al-Qaeda leader Osama) bin Laden. He is an arch murderer and as long as we have an opportunity we will try to kill him," Saar told army radio.
An army spokeswoman said Gaza militants had fired 159 rockets, of which 119 hit southern and central Israel while 27 were shot down. There have been no reports of any casualties.The army had hit 92 targets across Gaza, she added.
The violence left Egyptian truce efforts in tatters, with Netanyahu immediately ordering his delegation back from Cairo.
Israel has repeatedly refused to negotiate under fire.
Most of the Palestinian negotiators, including delegation head Azzam al-Ahmed, also left Cairo.
The Egyptian foreign ministry expressed "profound regret at the breach of the ceasefire" and said it was working to bring both sides back to the negotiating table.
Palestinian president Mahmud Abbas meanwhile landed in Qatar ahead of talks on Thursday with Hamas chief Khaled Meshaal that were scheduled before the ceasefire collapsed. (AFP)