Israel has launched air strikes on Hamas installations in Gaza City, causing heavy damage, according to witnesses.
At least 30 missiles were fired at targets on Saturday.
The simultaneous strikes were described as "massive" by the AFP news agency.
There was no immediate comment from Israel.
However, it follows the decision by the Israeli security cabinet to increase reprisals for cross-border rocket attacks against Israel, and the breakdown of a six-month-old Israel-Hamas truce earlier this month.
Several Hamas police compounds were said to have been hit.
Initial reports suggested that there were at least 50 casualties.
Palestinian sources say Israeli missiles targeted security compounds belonging to the militant group Hamas, which controls the territory.
A truce between Israel and Palestinian militants expired last week.
There was no immediate word on the explosions from the Israeli military.
At least 155 Palestinians have been killed in an Israeli aerial bombardment on Hamas security installations.
Israel launched air attacks across the besieged Gaza Strip on Saturday, threatening that further operations would be carried out later in the day.
Witnesses reported heavy damage as at least 30 missiles were fired on the targets.
Emergency services said that at least 200 people were also wounded.
Salam Fayyad, the Palestinian prime minister, condemned the attack and demanded an immediate cessation.
Hours after the Israeli assault, Gaza fighters fired home-made rockets into southern Israel, heeding calls by Hamas and other affiliated Palestinian groups to avenge the attacks, unprecedented in their scale.
One Israeli was killed in the rocket fire, medics said.
Islam Shahwan, a Hamas police spokesman, said a police graduation ceremony in Gaza City was struck by Israel. Among those killed was Tawfiq Jabber, the Gaza chief of police.
'War crimes'
Mahmoud Abbas, the Palestinian president and leader of Fatah, condemned the "aggression" in Gaza.
Mousa Abu Morzouz, the deputy leader of Hamas, told Al Jazeera: "Until now the aggression didn't stop ... they are targeting all the police headquarters and offices.
"We will defend our people, we will retaliate against this aggression ... our military will retaliate."
Morzouz called on the world's most powerful nations to condemn the attacks: "Nobody in this world can accept what happened and the Israeli aggression ... [we expect] the international community to stand against this and say that it is not acceptable."
Mustafa Barghouthi, the former Palestinian information minister, said: "This is not an attack on the Hamas. It is an attack on the whole population and the free will of the people of Gaza."
He accused Israel of committing "war crimes" and demanded that Abbas and his government stop all relations with Israel.
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