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Gaza's civil defence agency said Israeli bombardment of a school compound in Gaza City killed at least 17 people Saturday.

"There are 17 martyrs and several wounded due to Israeli shelling on Hamama school," the agency said in a statement, updating an earlier toll of 10 killed.

Earlier, civil defence spokesman Mahmoud Bassal said the compound was housing Palestinians displaced from their homes in the ongoing war since October 7.

The Israeli military have since confirmed the strike.

However, it has repeatedly accused Hamas of using civilian facilities as command and control centres or to hide their commanders and fighters. Palestinian officials deny the accusation.

Meanwhile, an Israeli airstrike hit a tent inside a hospital compound in central Gaza, killing at least five people, bringing the total of Palestinians killed on Sunday to 19, Gaza health officials said.

The airstrike hit a tent area inside the Al-Aqsa Hospital compound, starting a fire, wounding at least 18 people in addition to the five killed, medical authorities said.

The hospital compound is in the Deir Al-Balah area, which is crowded with thousands of people displaced by fighting in other parts of the enclave have sought shelter.

Israeli forces have continued strikes and shelling in the Gaza Strip after diplomatic efforts in Cairo on Saturday ended without progress, and as Israel braces for a serious escalation in the north.

Chances of a breakthrough appear low as regional tension has soared following the assassination of Hamas' leader Ismail Haniyeh in Tehran on Wednesday, a day after an Israeli strike in Beirut killed Fuad Shukr, a top military commander from Lebanese armed group Hezbollah.

Haniyeh's death was one in a series of killings of senior Hamas figures as the Gaza war nears its 11th month.

Hamas and Iran have both accused Israel of carrying out the assassination of Haniyeh and have pledged to retaliate. Israel has neither claimed nor denied responsibility for the death.

Hezbollah, like Hamas, is backed by Iran and has also vowed revenge after the killing of Shukr.

The war in Gaza erupted following the October 7 attack on Israel, which resulted in the death of 1,197 people, according to Israeli figures.

Israel's military campaign has killed at least 39,550 people, according to the territory's health ministry.