But he said he needed the United Nations to first press for a cease-fire to halt Israel's devastating military blitz, which has killed at least 106 Lebanese since Wednesday, most of them civilians.
"We call for working to extend the state's authority over all its territories in south Lebanon, in cooperation with the United Nations, and working to recover all Lebanese territories and exercising full sovereignty of the state over those territories," Saniora said in a televised address to the nation.
His voice cracking with emotion, Saniora criticized Hezbollah without naming the group, saying Lebanon "cannot rise and get back on its feet if its government is the last to know."
"The government alone has the legitimate right to decide on matters of peace and war because it represents the will of the Lebanese people," he said.
Saniora called for the United Nations to intervene to stop bloody cross-border fighting between Israel and Hezbollah in south Lebanon.
"We call for an immediate and comprehensive cease-fire under United Nations auspices," he said.
In Cairo, Egypt, foreign ministers of 18 Arab countries also asked for U.N. help. The Arab Leaguecalling on the U.N. Security Council to intervene to stop the escalating crisis in the region.
"The Middle East peace process has failed. The whole process should now be sent back to the Security Council for a complete overhaul," said Arab League Secretary-General Amr Moussa. "If the Security Council fails, nobody knows what might happen next," he added, pronouncing the whole Mideast peace process "dead."
The Lebanese Cabinet has refused to condone Hezbollah's kidnapping of two Israeli soldiers Wednesday, an action that triggered Israel's offensive on Lebanon, the worst attack on its neighbor in 24 years.
Saniora did not elaborate on how his government would work with the United Nations to reassert Lebanese authority over its entire territory.
Israel reacted coolly.
"It's an excellent declaration but he doesn't need our permission... We have to see what they do and not what they say," Vice Premier Shimon Peres told Israel's Channel 2 TV. He said Lebanon has to prove it is serious by deploying troops on the southern border.
"A foreign body (Hezbollah) has entered the area and it's your job to get them out of there," he said.
Saniora declared Lebanon a "disaster-stricken country" and accused Israel of executing an "immoral and illegitimate collective punishment" of the Lebanese people.
He appealed for national unity and spoke to the Lebanese people, saying: "We will surpass the ordeal, and we will face up to the challenge. We will rebuild what the enemy has destroyed as we always did."
In other developments:
Israeli tanks and armored personnel carriers late Saturday, Palestinian residents said, approaching a Palestinian town. The Israeli military would not officially confirm the new incursion.
At the G-8 conference in St. Petersburg, Russia, President Bush for the escalating violence in the Middle East, putting himself at odds with Russian President Vladimir Putin, who said he believed Israel was pursuing wider goals in its military campaign than the return of abducted soldiers.
The United States is working on a plan to to the neighboring island of Cyprus, the U.S. Embassy said Saturday. "We are looking at how we might transport Americans to Cyprus. Once in Cyprus, Americans can then board commercial aircraft for onward travel," an embassy statement said. The U.S. estimates 25,000 Americans live or work in Lebanon, but U.S. officials assume that far fewer would choose to leave if they could.
CBS News correspondent Cynthia Bowers reports on how the fighting has in Dearborn, Mich., who have family members in Lebanon. "Everything is escalating so quickly it doesn't give you time to breathe to react to one thing before something else happens," Issam Abbas
A senior Israeli intelligence official said Iranian troops helped Hezbollah fire the missile that damaged an Israeli warship off the Lebanese coast the night before. Two sailors aboard the warship were killed and two others are missing. Hezbollah denied it received Iranian help and Tehran said it had no role in the fighting, disputing Israeli claims that 100 Iranian soldiers had helped Hezbollah attack an Israeli warship late Friday. Iran's President Mahmoud Ahmadinejad condemned the Israeli offensive, accusing Israel of "behaving like Hitler."
Hezbollah's leader said Friday that his group is , and as his words were broadcast, guerrillas attacked an Israeli warship that had been firing missiles into southern Beirut. On Hezbollah's Al-Manar television less than an hour after missiles destroyed his headquarters and home, Sheik Hassan Nasrallah told Israelis, "You wanted an open war, and we are heading for an open war. We are ready for it."
Meanwhile, Israeli gunships attacked central Beirut for the first time in Israel's four-day-old assault on Lebanon, striking a lighthouse and the city's seaport, witnesses said.
A helicopter gunship flew into the Lebanese capital from over the Mediterranean and fired a missile at the lighthouse, located at the tip of the city in the Ras Beirut district, witnesses said.
The top glass section of the lighthouse was shattered, but the building, erected two years ago to replace an older one nearby, remained standing.
The tower is a recognizable landmark along the posh Manara seafront boulevard, where people stroll in the evenings or jog in the early mornings. It is a few hundred meters from the campus of the American University of Beirut, and adjacent to the Military Club.
Israeli artillery also hit grain silos at Beirut's seaport, the country's main commercial port facility, and the seaside resort area of Jounieh, where the Lebanese army has a base.
Beirut's commercial seaport is adjacent to the downtown district, where a multibillion dollar construction project had revived the city, which was destroyed in the 1975-90 civil war.
Two Lebanese army positions at Amchit and Hamat on the Mediterranean coast of central Lebanon, north of Beirut, were also hit, according to security officials.
It was not clear why Israel appeared to now be targeting the Lebanese army, but it could be to knock out radar capabilities, particularly after the Hezbollah missile attack that severely damaged an Israeli warship on Friday off the Beirut coast.
Israeli officials also warned that Hezbollah has missiles that could reach as far as 62-125 miles, into the country, putting cities such as Jerusalem and Tel Aviv at risk if the weapons are used.
A senior Israeli intelligence official, who spoke on condition of anonymity because of the sensitivity of the information, said that Hezbollah has 150 missiles that could reach a distance of about 28 miles, and another 20 with a range of 100-200 kilometers.
"They may hit Tel Aviv," the official said, adding that Israeli intelligence officials were not sure why Hezbollah has not used the missiles since it started firing rockets at Israel on Wednesday.