Thousands of Palestinian civilians rushed out of their family homes after Israel sent tanks into Rafah in southern Gaza, seizing the border crossing with Egypt in an operation the United Nations said denied it access to the key humanitarian passage.

The exodus of the local population was unprecedented as some loaded children and possessions onto donkey carts, some packed into cars, others simply walked. The roof of at least one car was piled high with mattresses. Another had a wheelchair stowed in the boot.

The thrust into the eastern sector of Rafah, packed with displaced civilians, came as negotiators and mediators met in Cairo in another effort to forge a hostage release and truce in the seven-month war.

A senior Hamas official, requesting anonymity, warned this would be Israel's "last chance" to free the estimated 128 captives still held in Gaza, including 36 officials say are dead.

Egypt's state-linked Al-Qahera News reported that mediators from Qatar, the United States and Egypt were meeting with a Hamas delegation.

It later reported that "all parties" including Israel had agreed to resume talks. Israeli Prime Minister Benjamin Netanyahu said earlier his country's delegation was already in Cairo.

Israel's close ally Washington said it was hopeful the two sides can "close the remaining gaps".

"We're going to do everything we can to support that process," National Security Council spokesman John Kirby said.

"Everybody's coming to the table," Kirby told reporters. "That's not insignificant."

Despite the Cairo talks, an AFP correspondent reported that Israeli strikes continued to pound east Rafah late Tuesday.

Israel's long-threatened Rafah operation began hours after Hamas announced late Monday it had accepted a truce proposal, prompting cheering crowds to take to the streets -- despite Israel saying it was "far" from plans it had previously agreed to.

Netanyahu said that "within hours" of approving the operation, "our forces raised the Israeli flags at the Rafah crossing and took down the Hamas flags".

He called it "a very important step" in denying Hamas "a passage that was essential for establishing its reign of terror".

Rafah resident Abu Aoun al-Najjar said the "indescribable joy" following the Hamas statement was short-lived.

"It turned out to be a bloody night," he told AFP, as more Israeli bombardment "stole our joy".

- Aid crossing to reopen -

Army footage showed tanks taking "operational control" of the Palestinian side of the Rafah crossing, in a deployment that the military said had a "very limited scope against very specific targets".

UN humanitarian office spokesman Jens Laerke said Israel had denied it access to both Rafah and Kerem Shalom -- the other main aid crossing, on the border with Israel -- with only "one day of fuel available" inside Gaza.

At the United Nations, Secretary-General Antonio Guterres urged Israel to "stop any escalation" and "immediately" reopen the crossings.

"The closure of both... crossings is especially damaging to an already dire humanitarian situation", Guterres said.

White House Press Secretary Karine Jean-Pierre told a briefing Israel's closure of the crossings was "unacceptable".

She said the Kerem Shalom crossing was expected to reopen on Wednesday.

The Pentagon meanwhile said the US military had completed construction of an aid pier off Gaza's coast, but weather conditions mean it is currently unafe to move the two-part facility into place.

Hamas's armed wing said Tuesday it fired rockets at Israeli troops at Kerem Shalom, two days after four Israeli soldiers were killed there in an attack it also claimed.

The war was sparked by Hamas's unprecedented October 7 attack on Israel, which resulted in the deaths of more than 1,170 people, mostly civilians, according to an AFP tally of Israeli official figures.

Vowing to destroy Hamas, Israel launched a retaliatory offensive that has killed at least 34,789 people in Gaza, mostly women and children, according to the Hamas-run territory's health ministry.

Defence Minister Yoav Gallant said Israel may "deepen" its Gaza operation if negotiations fail to bring the hostages home.

"This operation will continue until we eliminate Hamas in the Rafah area and the entire Gaza Strip, or until the first hostage returns," he said in a statement.

- Three-phase truce -

Egypt, which has a peace treaty with Israel, and Qatar, a US ally that also hosts Hamas leaders, have taken the lead in the talks.

Hamas said Monday it had told Egyptian and Qatari officials of its "approval of their proposal regarding a ceasefire".

Netanyahu's office called the proposal "far from Israel's essential demands", but the government would still send negotiators to Cairo.

Hamas member Khalil al-Hayya told the Qatar-based Al Jazeera news channel that the proposal agreed to by Hamas involved a three-phase truce.

It included a complete Israeli withdrawal from Gaza, the return of Palestinians displaced by the war and a hostage-prisoner exchange, with the goal of a "permanent ceasefire", he said.

International alarm has been building about the consequences of an Israeli ground invasion of Rafah, where the United Nations says 1.4 million people are sheltering.

EU foreign policy chief Josep Borrell said the attack on Rafah began despite European and US warnings, and it could cause many "civilian casualties".

US spokesman Kirby said Israel told Washington "that this operation last night was limited and designed to cut off Hamas's ability to smuggle weapons" into Gaza.

Egypt urged Israel to "exercise the utmost restraint", while the Organization for Islamic Cooperation condemned Israel's "criminal aggression".

- 'Tangible opportunity' -

Netanyahu had repeatedly vowed to send ground troops into Rafah regardless of any truce, saying Israel needs to root out remaining Hamas forces.

The Hostages and Missing Families Forum said it had appealed to several countries to "exert your influence on the Israeli government".

In a message to ambassadors of governments with citizens among the hostages, it asked them to push for an agreement "while a tangible opportunity for the release of the hostages is on the table".

Aid groups warn the coastal "humanitarian area" of Al-Muwasi that Israel's military told people in eastern Rafah to head for unprepared for such an influx.

Philippe Lazzarini, head of the UN agency for Palestinian refugees UNRWA, said Tuesday it was "overcrowded with more than 400,000 people".

Al-Muwasi "does not have the facilities to take more people & is not safer than other parts of Gaza", he said in a post on X.

Medical charity Doctors Without Borders (MSF) said it had begun discharging patients from a field hospital in Rafah and was preparing "for a possible evacuation".

"This offensive is... going to further aggravate the damage to the health system, which is barely functioning," an MSF statement said.

 Attacks kill 7 in Gaza

An Israeli air strike killed at least seven people and wounded several others early Wednesday in Gaza City, according to a local hospital.

The strike on an apartment in the devastated northern city killed seven members of the same family, the Al-Ahli hospital said, with eyewitnesses on Wednesday also reporting strikes elsewhere in the strip, particularly around Rafah.

US pauses bomb shipment to Israel over Rafah 'concerns': official

The United States paused a shipment of bombs last week after Israel failed to address US "concerns" over its plans to invade the southern Gaza city of Rafah, a senior US official said Tuesday.