While southern Israeli areas near Gaza have long coped with rocket fire, the attacks on the Tel Aviv area illustrated the significant capabilities that Hamas militants have developed. Gaza militants had previously hit Rishon Lezion before but never reached Tel Aviv, roughly 70 kilometers, or 50 miles, north of the strip.
Israel launched the offensive on Wednesday, killing the head of Hamas' militant wing and destroying dozens of rocket launchers. Israel has made special efforts to destroy launchers for Hamas' Iranian-made "Fajr" rockets, which are believed capable of flying even deeper into Israel.
Residents across southern Israel remained huddled indoors or close to home, ordered by authorities to remain close to a network of public bomb shelters.
The deaths in the southern Israeli town of Kiryat Malachi, where a rocket slammed into an apartment building, were the first in Israel since the fighting began.
Explosions rocked Gaza throughout the day as well. Few in the territory's largest urban area, Gaza City, came out following the call for dawn prayers, and the only vehicles plying the streets were ambulances and media cars.
Most Gazans remained in their homes, following developments on Hamas-run TV and local radio stations. Many also provided updates on their Facebook and Twitter accounts, providing news about airstrikes and rocket launches. Others shared prayers and called for militants to stand tough against Israel.
While streets were quiet, bakeries and groceries remained open. No food shortages were reported, and electricity, which suffers frequent outages even during normal times, remained sporadic. Many families keep home generators to maintain power.
"I am trying to calm my children when they hear the sound of explosions," said Zainab Nimr, a 33-year-old mother of three. "We have enough food and water for four days, so I asked my husband to go out and get extra supplies. No one knows when this will end."
Thousands of people, including top Hamas officials, braved the threats to attend the funeral for Jabari, who had long topped Israel's most-wanted list for his role in deadly attacks and building up Hamas' formidable arsenal. Dozens of residents stood solemnly outside their homes or on their balconies as the procession walked by.
"We want to kill in the name of God," chanted mourners as angry gunmen fired automatic weapons into the air. Hundreds of people raised their index fingers in the air, chanting, "God is great."
"This crime will not weaken us. It will make us stronger and more determined to continue the path of jihad and resistance," Hamas lawmaker Mushir al-Masri said in a eulogy. "The enemy opened the battle and shall bear the consequences."
Israel's military spokesman, Brig. Gen. Yoav Mordechai, said the air operation has delivered a "strong blow" to militants' launching sites.
In all, 15 Palestinians have been killed and nearly 200 wounded in fighting on Wednesday and Thursday. The Israeli military says three soldiers were wounded in a rocket attack.
The military said its air campaign has hit 230 targets across Gaza, and its "Iron Dome" rocket defense system has intercepted some 90 incoming rockets.
Still, Palestinian militants continued to launch rockets into Israel throughout the day.
In Washington, the United States lined up behind Israel.
"We support Israel's right to defend itself, and we encourage Israel to continue to take every effort to avoid civilian casualties," State Department spokesman Mark Toner said.
President Barack Obama spoke with Netanyahu and the two men agreed Hamas needs to stop its attacks on Israel to allow tensions to ease, the White House said.
Obama spoke separately to Egyptian President Mohammed Morsi, given Egypt's central role in preserving regional security, the White House said. The two men agreed on the need to de-escalate the conflict as quickly as possible.
U.N. Secretary-General Ban Ki-moon called for calm and urged both sides to respect international humanitarian law.
Turkey and Iran, Muslim countries that both have good relations with Hamas, condemned Israel.