Israel's acceptance of a short-lived Egyptian truce which was rejected by Hamas, has set the scene for a much broader operation in Gaza, including a limited ground incursion, analysts say.

Although the ceasefire plan unveiled by Cairo did not lead to an end to the latest round of violence, Israel's agreement to hold its fire for six hours -- even as Hamas militants continued firing rockets over the border -- won it some room for manoeuvre.

"In the eyes of the world, Israel took a risk and gave a real chance to a ceasefire, while Hamas chose to continue fighting. This gave Israel renewed credit, including credit to expand the operation," wrote Yoav Limor in pro-government freesheet Israel Hayom.

After six hours of calm, Prime Minister Benjamin Netanyahu ordered the military to resume its operations, saying Hamas's rejection of the ceasefire had granted Israel the "international legitimacy" to expand and intensify its military operations.

Shortly afterwards, he convened his security cabinet to discuss an operation against the network of tunnels used by militants to set up rocket launchers.

Ministers also discussed a limited ground incursion into the fringes of Gaza, which would not involve troops entering populated areas in the initial stage, army radio reported.

Commentators suggested there were three ways Israel could step up its campaign against militants in Gaza.

"There are three escalation scenarios -- stepping up the air strikes; a limited ground operation at the margins of the Gaza Strip against the exits of the tunnels; and a broad ground operation at the end of which Israel will control Gaza for six months, two years or 20 years," wrote Alon Pinkas in the top-selling Yediot Aharonot.

In recent weeks, there have been growing calls from cabinet hardliners, among them Foreign Minister Avigdor Lieberman, for a full re-occupation of the territory from which Israel withdrew in 2005. Netanyahu has so far ignored them.

- A limited ground operation? -

Early on Wednesday, the Israeli army dropped flyers over northeastern Gaza, urging 100,000 residents to leave the area ahead of an intensified air campaign.

So far, there has been no move to send in any of the 43,000 reserve troops who have been mobilised, or the armour massed along the border.

But in a move which could indicate a shift in thinking, the cabinet on Wednesday authorised the call-up of another 8,000 reservists, media reports said.

Experts say a ground operation would be the only way of reaching targets unattainable from the air, such as Hamas's network of underground bunkers and tunnels which are crucial for assembling the rockets Israel wants to eradicate.

"Hamas is largely inspired by the techniques used by Hezbollah, notably its underground infrastructure, which gives it the capacity to hold out for weeks," political commentator Daniel Nisman told AFP, referring to Lebanon's Shiite militia.

Former national security adviser Giora Eiland agreed that only a ground operation would succeed in inflicting "real destruction" on Hamas's underground network.

"I estimate that if there are no unexpected developments and if a ceasefire is not agreed at the last moment, within 48 hours there will be a limited ground operation," Eiland told Mako news website, estimating such an assault would last "weeks."

Nisman said Israel had so far been able to avoid putting boots on the ground thanks to the success of the Iron Dome air defence system, which has shot down more than 250 rockets over the past nine days, minimising casualties on the Israeli side.

So far one Israeli has been killed and four seriously wounded.

"The Iron Dome anti-missile system has worked well and allowed Israel to take its time and carry out air strikes which are perhaps less effective than using special military units, but which allow Israel to avoid a military operation in which it has a lot to lose," Nisman said.

Israel was hoping that an intensified air campaign would convince Hamas to back down, thereby avoiding the need to send troops in, commentators said.

"Israel would prefer to hold off on the ground option and to make do with intensifying the aerial bombardments, in the hope that Hamas will get the message and agree to a ceasefire soon," Limor wrote.