Israel at 'war" against Hamas after rockets fired: Netanyahu

"We are at war, not in an operation or in rounds, but at war," the Israeli leader said in a statement, adding Hamas had launched a "murderous surprise attack" on Israel and its people.

"I have ordered an extensive mobilisation of reserves and that we return fire of a magnitude that the enemy has not known. The enemy will pay an unprecedented price," he said.

Israel's army said it was fighting Gaza militants who entered Israel by land, sea and air using paragliders on Saturday, after a barrage of rockets was fired at Israel from the Palestinian enclave.

"It was a combined ground raid which happened through paragliders, through the sea and through the ground," army spokesman Richard Hecht told reporters.

"Right now we're fighting. We're fighting in certain locations around the Gaza Strip... our forces are now fighting on the ground" in Israel, he added.

Hecht confirmed there are casualties but would not be drawn on details, nor discuss reports that multiple Israelis had been captured by Palestinian militants.

Thousands of military reservists are set to be drawn up for Gaza, as well as northern Israel, near foes Lebanon and Syria, and the occupied West Bank.

"We're looking at all arenas... we understand this is something big," Hecht said.

At least 2,200 rockets were fired from Gaza by around 10:30 am (0730 GMT), the spokesman said, while Hamas militants put the figure at more than 5,000.

Israel imposed a crippling blockade of Gaza in 2007 after Hamas took control and there have been multiple cross-border wars since.

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