At least eight Palestinians, many of them children, were killed by Israeli fire Wednesday as they demonstrated against the military operation. Adding to world anger were the sight of bloodied children and reports of overwhelmed doctors treating dozens of wounded on blood-drenched hospital floors.
Israel apologized for the deaths, saying its troops did not deliberately fire on marchers. It also blamed the Palestinians for allowing gunmen to mix with the civilian crowd. Palestinians denounced the incident as a massacre.
The U.N. Security Council passed a resolution condemning the loss of life and Israel's demolition of homes. The United States abstained, the first time in nearly two years that it didn't exercise its veto on a resolution sharply critical of Israel.
Brig. Gen. Ruth Yaron, the army's chief spokeswoman, said Thursday that the offensive — the largest in Gaza in years — will continue until troops obliterate weapons-smuggling tunnels and round up militants along the Gaza-Egypt border.
Early Thursday, an Israeli missile strike killed three militants in the Rafah camp. The army said the gunmen were approaching Israeli forces. Hours later, troops fired a tank shell and killed two militants near the border, Palestinian doctors said.
Elsewhere, a hospital official said one man was killed and two wounded by gunfire in the camp. Dr. Ali Mousa, director of the Rafah hospital, said a 37-year-old man died from a gunshot wound to the head and two others, aged 22 and 29, were wounded.
Relatives said the men were shot when they ventured onto the roof of their apartment building to check a water tank.
Another body was brought to the hospital Thursday; it was not immediately known how the man died. The army said troops shot a gunman when he approached Israeli forces in Tel Sultan Thursday. His condition was unknown.
With electricity and water supplies to the area cut off, local officials warned of a looming humanitarian crisis. Asharaf Ghonem of the Rafah water department said water from a well in Tel Sultan could not reach other parts of Rafah because there was no power.
He said Israeli tanks had prevented workmen from repairing generators and asked the army to guarantee their safe passage.
The army said it was working "24 hours a day" to facilitate humanitarian aid.
"We want water to save our life, is that too big to ask? Water is life," said Tel Sultan resident Salman Abu Jazar, 30. "My wife boiled the lavatory water to prepare the milk for our 11-month-old son."
Since Israel launched its operation early Tuesday, 39 Palestinians, including several children, have been killed. Dozens have been wounded, and refugee camp residents have been dealing with power outages and lack of water.
Israel raided the refugee camp less than a week after Palestinian militants killed 13 soldiers in Gaza, seven of them along the Egyptian border.
By Thursday morning, the army had taken full control of four neighborhoods in the camp, home to nearly 60,000 people. Light exchanges of fire were reported, and Israeli Apache helicopters flew overhead.
Early Thursday, forces demolished a four-story building owned by Islamic Jihad leader Nafez Azzam and a small Islamic sports club. Residents said at least eight homes had been demolished overnight. The army did not comment.
At one point on Wednesday, Palestinian men in the Rafah neighborhood of Tel Sultan followed army orders. Waving white flags, they gathered on the main street to be questioned by soldiers. Minutes later, the army fired a tank shell at the demonstration headed in the direction of Tel Sultan.
A preliminary army investigation concluded that a warning shot fired by a tank meant to disperse Wednesday's protest had flown through a building and hit the crowd, security sources said. They spoke on condition of anonymity.
Palestinian leader Yasser Arafat called the deaths "genocide" and a "massacre that stands against all humane, civilized and political principles."
Hospital director Moussa said Thursday that eight people were confirmed dead, including six people under 18. He said 55 were wounded, several in serious condition. Palestinian officials had earlier put the death toll at 10.
The U.N. Security Council passed a resolution early Thursday condemning the loss of life and Israel's demolition of homes. The decision by the United States not to use its veto power — usual practice with resolutions critical of Israel — reflected the White House's displeasure with the Israeli incursion.
In unusually strong U.S. criticism of Israel, Secretary of State Colin Powell said the Gaza operations "have caused a problem and have worsened the situation and, I think, made it more difficult for us to move forward and get back into the peace process."
CBS News Correspondent Robert Berger Israeli officials say they're disappointed that the U.S. did not veto the resolution.
President Bush stopped short of condemning Israel's attack, but European leaders sharply criticized Israel.
The fighting has revived debate inside Israel on its continued presence in Gaza. Sharon has proposed withdrawing from the volatile area, but his Likud Party rejected the proposal earlier this month. Sharon has pledged to push forward with his plan.
Elsewhere, near the West Bank town of Tulkarem, the army said it had killed a Palestinian gunman after a shootout.
Palestinian officials also said a 13-year-old was shot dead by troops near the West Bank town of Hebron. The army said it fired on a Palestinian who threw a firebomb at troops.
Also Thursday, an Israeli court convicted prominent Palestinian uprising leader Marwan Barghouti of overseeing militant attacks that killed five people.
But the court failed to find Barghouti guilty on charges related to other attacks in which 21 Israelis were killed. Some Israeli media had reported earlier that he was convicted in all the deaths.