Some 1,750 Palestinians have also been injured in the four-day offensive, which Israel launched on Saturday in what it called "an all-out war" against Hamas in response to militant rocket attacks on southern border towns from Gaza.
Eyewitnesses said Israel launched at least 50 airstrikes on the Hamas-controlled Gaza Strip targeting government buildings, including the prime minister's office, the interior, defense and finance ministries, as well as schools and the Islamic University, which is viewed as an "ideological cradle" for Islamists.
In response to Israeli airstrikes, Palestinian militants launched over 80 rockets and mortar shells on southern Israel killing three people with over 35 others injured, some of them seriously.
Defense minister Ehud Barak announced "a special situation" for settlements located within a 30-km zone from Gaza, including Ashdod, Ashkelon, Kiryat Gat, Netivot and Sderot, which have a combined population of over 400,000.
Regions which directly border Gaza have been declared a "closed military zone."
Tel Aviv has mobilized up to 6,500 reservists and deployed tanks on Gaza's border in preparation for a possible ground offensive on the coastal enclave of 1.5 million Palestinians.
Foreign ministers of EU countries will gather in Paris later Tuesday for emergency talks on Gaza. The meeting, to be chaired by French foreign minister Bernard Kouchner, will focus on combining efforts with the rest of the international community to find a way to overcome the crisis.