The U.N. chief called for an immediate ceasefire in the Gaza Strip on Tuesday and U.S. Secretary of State Hillary Clinton headed to the region with a message that escalation of the week-long conflict was in nobody's interest.
Nevertheless, Israeli air strikes and Palestinian rocket fire continued for a seventh day.
Egypt was trying to broker a truce between Israel and Gaza's ruling Hamas movement. An Egyptian intelligence source said "there is still no breakthrough and Egypt is working to find middle ground".
Israel's military on Tuesday targeted about 100 sites in Gaza, including ammunition stores and the Gaza headquarters of the National Islamic Bank. Gaza's Hamas-run Health Ministry said six Palestinians were killed.
Israeli police said more than 60 rockets were fired from Gaza by mid-day, and 25 of the projectiles were intercepted by Israel's Iron Dome system. The military said an officer was wounded.
Some 115 Palestinians have died in a week of fighting, the majority of them civilians, including 27 children, hospital officials said. Three Israelis died last week when a rocket from Gaza struck their house.
In Cairo, U.N. Secretary-General Ban Ki-moon called for an immediate ceasefire and said an Israeli ground operation in Gaza would be a "dangerous escalation" that must be avoided.
Israel's leaders weighed the benefits and risks of sending tanks and infantry into the densely populated coastal enclave two months before an Israeli election, and indicated they would prefer a diplomatic path backed by world powers, including U.S. President Barack Obama, the European Union and Russia.
The White House said Clinton was going to the Middle East for talks in Jerusalem, Ramallah and Cairo to try to calm the conflict. An Israeli source said she was expected to meet Benjamin Netanyahu on Wednesday.
Prime Minister Netanyahu and his top ministers debated their next moves in a meeting that lasted into the early hours of Tuesday.
"Before deciding on a ground invasion, the prime minister intends to exhaust the diplomatic move in order to see if a long-term ceasefire can be achieved," a senior Israeli official, speaking on condition of anonymity, said after the meeting.
A delegation of nine Arab ministers, led by the Egyptian foreign minister, was due in Gaza later on Tuesday in a further signal of heightened Arab solidarity with the Palestinians.
EGYPT KEY PLAYER
Any diplomatic solution may involve Egypt, Gaza's other neighbour and the biggest Arab nation, where the ousting of U.S. ally Hosni Mubarak and the election of Mursi is part of a dramatic reshaping of the Middle East wrought by Arab uprisings and now affecting the Israeli-Palestinian conflict.
Mursi has warned Netanyahu of serious consequences from a ground invasion of the kind that killed more than 1,400 people in Gaza four years ago. But he has been careful not to alienate Israel, with whom Egypt's former military rulers signed a peace treaty in 1979, or Washington, a major aid donor to Egypt.
After Hamas leader Khaled Meshaal laid out demands in Cairo that Israel take the first step in restoring calm, and warned Netanyahu that a ground war in Gaza could wreck his re-election prospects in January, a senior Israeli official denied a Hamas assertion that the prime minister had asked for a truce.
"Whoever started the war must end it," Meshaal said, referring to Israel's assassination from the air on Wednesday of Hamas's Gaza military chief, a move that followed a scaling up of rocket fire onto Israeli towns over several weeks and attacks against Israeli troops along the border.
Fortified by the ascendancy of fellow Islamists in Egypt and elsewhere, and courted by Sunni Arab leaders in the Gulf keen to draw the Palestinian group away from old ties to Shi'ite Iran, Hamas has tested its room for manoeuvre, as well as longer-range rockets that have reached the Tel Aviv metropolis.
Hamas said four-year-old twin boys had died with their parents when their house in the town of Beit Lahiya was struck from the air during the night. Neighbours said the occupants were not involved with militant groups.
Nonetheless, fighting Israel, whose right to exist Hamas refuses to recognise, is popular with many Palestinians and has kept the movement competitive with the secular Fatah movement of Palestinian President Mahmoud Abbas, who remains in the West Bank after losing Gaza to Hamas in a civil war five years ago.
"Hamas and the others, they're our sons and our brothers, we're fingers on the same hand," said 55-year-old Faraj al-Sawafir, whose home was blasted by Israeli forces. "They fight for us and are martyred, they take losses and we sacrifice too."
