'We are at war': Israeli PM Netanyahu responds after Hamas launches unprecedented attack

Israeli Prime Minister Benjamin Netanyahu has told Israel that it is “at war” with Hamas militants that rule the Gaza Strip.

Netanyahu's comments in a televised address mark his first since the Gaza Strip's Hamas rulers launched a major, multi-front attack on Israel at daybreak Saturday.

He ordered a call-up of reservists and promised that Hamas would “pay a price that it hasn't known until now.”

“We are at war,” Netanyahu said. “Not an ‘operation,’ not a ‘round,’ but at war.”

The prime minister also ordered the military to clear the infiltrated towns of Hamas militants that remained locked in gunfights with Israeli soldiers.

Hamas on Saturday fired thousands of rockets at Israel and sent dozens of fighters across the country's heavily fortified border, a massive show of force that caught Israel off-guard on a major holiday.

Israel's army carried out at least two air strikes on the Gaza Strip Saturday, an AFP journalist reported.

"Dozens of IDF fighter jets are currently striking a number of targets belonging to the Hamas terrorist organisation in the Gaza Strip," the military said.

More than 5,000 rockets had been fired so far from the Gaza Strip, the armed wing of Hamas which controls the blockaded coastal enclave said. Medics said the rocket fire killed at least one Israeli, a woman in her 60s.

Israel's defense minister announced that the Hamas militant group has started a war against Israel and pledged that "Israel will win".

Following a security cabinet meeting at the Israeli military headquarters in Tel Aviv, Defense Minister Yoav Gallant warned that Hamas “made a grave mistake” in launching barrages of rockets into southern and central Israel in its surprise morning attack.

"Troops are fighting against the enemy at every location," he said in a statement.

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Violence between Israel and the Palestinians has been surging for almost two years, with fatalities in the occupied West Bank hitting a scale not seen in years.

Rockets had earlier streamed across the sky repeatedly after the first launches from multiple locations across the Palestinian territory from 6.30 am (0330 GMT), AFP journalists in Gaza City reported.

The armed wing of Hamas, which controls Gaza, said it was behind the aerial assault, saying its militants had launched thousands of rockets and its fighters seized an Israeli tank.

Israel's army did not immediately comment on the tank claim when contacted by AFP.

Israeli security chiefs convened over the violence, which occurred on Shabbat and during a Jewish holiday.

Air raid sirens wailed across southern and central Israel, and the army urged people to stay near bomb shelters.

AFP journalists in Jerusalem heard multiple rockets being intercepted by Israeli air defence systems. Sirens blared across the city on more occasions than in any Gaza conflict in the past three years.

Hundreds of residents fled their homes in eastern Gaza to move away from the border with Israel, an AFP correspondent said.

Men, women and children carrying blankets and food left their homes, mostly in the northeastern part of the territory, the reporter said.

A regional council for Israeli communities northeast of Gaza said its president was killed in an exchange of fire with attackers from Gaza.

Fifteen others were wounded, two of them seriously, medics said.