An Israeli strike on Gaza City killed 20 Palestinians and wounded 150 who were queuing for food aid, Gaza's health ministry said, in what Palestinian groups called a "war crime."
The Israeli military said it was looking into the report.
To the south of the enclave Israeli tanks struck areas around two hospitals in Gaza's main southern city Khan Younis, forcing displaced people into a new desperate search for safety, residents said.
Meanwhile in the north a World Health Organization official described the food situation as "absolutely horrific" and humanitarian workers said rare deliveries of aid were mobbed by desperate people who were visibly starving.
Most of Gaza's 2.3 million population is now squeezed into Khan Younis and towns just north and south of it, after being driven out of Gaza's northern half earlier in Israel's military campaign, now in its fourth month.
Gaza health officials said at least 50 Palestinians had been killed in the past 24 hours in Khan Younis, where Israel has shifted military operations after starting to pull forces out of northern areas it says it now largely controls.
"There's no safe area, where shall we go? Stop the war, it is enough, we are drained, everyone is drained, children are gone, and adults are gone. Everyone is gone and the world is watching," a Palestinian woman said in Rafah, on Gaza's southern edge.
In its latest update, the Israeli military said forces in Khan Younis were fighting militants at close quarters and were using precision air strikes and snipers to take out multiple Hamas targets.
Palestinian medics said Israeli tanks had cut off and were shelling targets around the city's two main still-functioning hospitals, Nasser and Al-Amal, trapping medical teams, patients and displaced people huddled inside or nearby.
Israel says Hamas militants use hospital premises as cover for bases, something the Islamist group and medical staff deny.
Earlier, tens of thousands of displaced Palestinians sheltering in a compound in Khan Younis prepared to flee to Rafah, 15km away, after Israeli tank forces nearby ordered all civilians inside to leave, UN officials said.
More than 30,000 people were packed inside the compound, they added.
There was no immediate comment from the Israeli military.
The International Committee of the Red Cross said less than 20% of the enclave's, around 60sq/km, now harboured over 1.5 million displaced people in the south, where the escalation of fighting "threatens their survival".
Some 25,900 Palestinians have been killed by Israeli strikes in Gaza, Palestinian health officials say, with large tracts of the heavily built-up enclave flattened by bombing.
Israel unleashed its war to eradicate Hamas after militants attacked Israeli towns and bases on 7 October, killing 1,200 people and seizing around 240 hostages, according to Israeli figures.
The Israeli military has said it has killed more than 9,000 Hamas militants and lost 220 soldiers in the 3-1/2-month-old war.
Hamas has dismissed Israel's figures on militant deaths.
Ahead of a ruling by UN judges tomorrow on South Africa's request for an immediate halt to Israel's military operation in Gaza, which it has accused of state-led genocide, Hamas said it would abide by any ruling for a ceasefire if Israel reciprocates.
Hamas would also release the Israeli hostages in Gaza if Israel releases all Palestinians prisoners, senior Hamas official Osama Hamdan said at a news conference in Beirut.
Israel has asked the International Court of Justice in The Hague to reject the case outright.
An Israeli government spokesperson said they expect the UN' s top court to "throw out these spurious and specious charges".
Mediated talks
Urgent international appeals for a ceasefire to spare civilians who have borne the brunt of casualties have gone unheeded with Israel vowing not to relent until Hamas has been eradicated and all hostages freed.
Hamas says any deal must hinge on Israel ending its offensive and siege, and withdrawing from Gaza.
Mediated talks on a month-long truce that could see hostages freed in swaps for Palestinian prisoners in Israel have resumed, but have snagged on the two sides' differences over how to bring an end to the war, sources told Reuters.
The directors of Israel's Mossad intelligence service and the US Central Intelligence Agency will meet Qatar's prime minister in Europe this weekend to discuss a ceasefire in Gaza and release of hostages, an official briefed on the meeting told Reuters.
Gaza's conflict threatens to destabilise the Middle East, stoking hostilities ranging from the Israeli-occupied West Bank to the Israel-Lebanon border region, Syria, Iraq and Red Sea shipping lanes crucial to international trade.
