Hamas remained defiant. "This aggression must cease. The blockade must be lifted. The crossings must be unconditionally open. The oppression of our people must end. After that, we can talk," Hamas spokesman Fawzi Barhoum said. He said Wednesday's lull was an Israeli "ruse."

In the meantime, Israel has been making preparations to continue fighting. The military has called up thousands of reserve troops that it could use to expand the Gaza offensive, supporting the three brigade-size formations of regular troops now inside. Defense officials said the troops could be ready for action by Friday. They spoke on condition of anonymity because the army's preparations are classified.

Israel's military said its shelling of the U.N. school � the deadliest single episode since Israeli ground forces invaded Gaza on Saturday following a weeklong air bombardment � was an attack on a military target and accused Hamas militants of using civilians as cover.

Christopher Gunness of the U.N. Relief and Works Agency, responsible for the school, said the agency is "99.9 percent certain there were no militants or military activity in its school."

That would not necessarily contradict Israel's claim that the militants were just outside.

Gunness demanded an investigation, and punishment for anyone found to have violated international law.

Two residents of the area who spoke with The Associated Press by telephone said they saw a small group of militants firing mortar rounds from a street near the school. They spoke on condition of anonymity for fear of reprisal. Gunness said 1,300 people were taking shelter from the shelling at the school.

Barhou, the Hamas spokesman, said there were no militants there at the time.

The Gaza-based Palestinian Center for Human Rights said the presence of militants did not justify Israel's response. "The presence of armed resistance does not justify in any way the use of excessive force that is disproportionate," the center said in a statement.