Gaza's Hamas-run civil defence says 11 people were killed, all from the same family, after the bus they were in was hit by an Israeli tank shell in northern Gaza.
The Abu Shaaban family, it said, were trying to reach their home to inspect it when the incident happened in the Zeitoun neighbourhood of Gaza City on Friday night.
This is the deadliest single incident involving Israeli soldiers in Gaza since the start of the ceasefire eight days ago.
The Israeli military said soldiers had fired at a "suspicious vehicle" that had crossed the so-called yellow line demarcating the area still occupied by Israeli forces in Gaza.
Israeli soldiers continue to operate in more than half of the Gaza Strip, under the terms of the first phase of the ceasefire agreement.
Civil defence spokesman Mahmud Bassal told AFP news agency the victims were killed while "trying to check on their home" in the area.
The dead included women and children, according to the civil defence.
The Israel Defence Forces (IDF) said a "suspicious vehicle was identified crossing the yellow line and approaching IDF troops operating in the northern Gaza Strip" on Friday, prompting it to fire "warning shots" towards the vehicle.
It said the vehicle "continued to approach the troops in a way that caused an imminent threat to them" and "troops opened fire to remove the threat, in accordance with the agreement."
Hamas said the family had been targeted without justification.
The IDF has warned Palestinians from entering areas in Gaza still under its control.
With limited internet access, many Palestinians do not know the position of Israeli troops as the yellow demarcation line is not physically marked, and it is unclear if the area where the bus was travelling did cross it.
The BBC has asked the IDF for coordinates of the incident.
Israeli Defence Minister Israel Katz said on Friday the army would set up visual signs to indicate the location of the line.
Israel carried out several strikes on Gaza Sunday after saying its troops came under fire from militants in a “blatant” violation of the ceasefire, the first major test of the US-brokered truce.
An Israeli military official saidHamas attacked Israeli forces in Rafah with rocket-propelled grenades and sniper fire, prompting Israel to carry out strikes in the area - just nine days after the ceasefire began.
Another source familiar with the incident said Israeli forces suffered casualties as a result of the attacks. The incident occurred beyond the Yellow Line – the initial Israeli withdrawal boundary outlined in the ceasefire agreement.
Both sides have accused each other of violating the truce, which brought an end to months of fighting and allowed the release of Israeli hostages, as well as Palestinian prisoners and detainees. But Sunday’s incident is the most serious threat yet.
Hamas said in a statement Sunday that it remains committed to the ceasefire agreement. Its military wing, Al Qassam Brigades, denied knowledge of “any events or clashes” in Rafah and said they are committed to the truce “throughout all areas of the Gaza Strip.”
Prime Minister Benjamin Netanyahu held a security consultation with defense minister Israel Katz and military chiefs on Sunday, instructing them to “act forcefully” against “terrorist targets” in Gaza. The Israel Defense Forces (IDF) said it had carried out airstrikes and artillery fire in Rafah, destroying Hamas infrastructure.
“Hamas will pay a heavy price for every shooting and violation of the ceasefire, and if the message is not understood, the intensity of our responses will continue to increase,” Katz said in a statement.
Netanyahu faces pressure to respond from far-right parties supporting his coalition, with the Minister of National Security, Itamar Ben Gvir, calling on him to resume the war in Gaza “in full force.”
