Fierce gun battles between Israeli troops and Hamas-led Palestinian fighters were also taking place.
Residents said tanks that have taken control along the borderline with Egypt made several raids towards the west and the center of the southern city, wounding several residents who had been trapped inside their homes and were taken by surprise.
"I think the occupation forces are trying to reach the beach area of Rafah, the raids and the bombing overnight were tactical, they entered under heavy fire before they retreated," said one Palestinian man.
"It was one of the worst nights, some people were wounded inside their homes, before being evacuated this morning," he told Reuters via a chat app.
Israeli forces have also operated inside the Al-Bureij camp in the central Gaza Strip on the ground, while it kept two other camps and a city nearby under heavy bombardment from planes and tanks, killing and wounding several Palestinians, medics said.
The armed wings of Hamas, the Islamic Jihad, and smaller other groups reported their fighters carried out attacks against invading Israeli forces in several areas in central and southern the enclave.
Qatari and Egyptian mediators, backed by the United States, have stepped up efforts to reach a ceasefire deal, that will halt hostilities and see the release of Israeli hostages and a number of Palestinians jailed by Israel, but sources close to the talks said there were no signs of a breakthrough.
Since a brief week-long truce in November, all attempts to arrange a ceasefire have failed, with Hamas insisting on its demand for a permanent end to the conflict. Israel says it is prepared to discuss only temporary pauses until the group is defeated.
"We have shown all the flexibility needed to reach a deal but the Israeli occupation continues to refuse any commitment to end the aggression and pull its forces from the Gaza Strip," a Hamas official told Reuters.
"The occupation and the Americans are to blame for the absence of a deal so far because they don't want this war on our people to end," he said.
Hamas precipitated the war by attacking Israeli territory last Oct. 7, killing around 1,200 people and capturing more than 250 hostages, according to Israeli tallies. About half the hostages were freed in the November truce.
Israel's military assault on Gaza has killed more than 36,000 people, according to health officials in the territory, who say thousands more dead are feared buried under the rubble.
U.S. and Israeli officials have told Reuters about half of Hamas's forces have been killed in the conflict. Hamas does not disclose fatalities among its fighters and some officials say Israel exaggerated the figures. Israel's own military death toll is almost 300.
