Israel has declared a Gaza ceasefire over, saying Hamas militants breached the truce soon after it took effect and apparently captured an Israeli officer while killing two other soldiers.
Renewed Israeli shelling killed more than 70 Palestinians and wounded some 220, hospital officials said. Prime Minister Benjamin Netanyahu called his security cabinet into special session and publicly warned Hamas and other militant groups they would "bear the consequences of their actions".
The 72-hour break announced by US Secretary of State John Kerry and UN Secretary-General Ban Ki-moon was the most ambitious attempt so far to end more than three weeks of fighting, driven by mounting international alarm over a rising Palestinian civilian death toll.
US President Barack Obama called for the Israeli soldier's unconditional release and said that after the day's events it would be tough to reinstate a truce.
"I think it's going to be very hard to put a ceasefire back together again if Israelis and the international community can't feel confident that Hamas can follow through," he told a news conference.
Mr Obama said he has been in constant contact with Mr Netanyahu about the situation, and added that more needs to be done to protect Palestinian civilians.
Mr Kerry said he had asked Qatar, which is close to Hamas, and Turkey to help free the soldier. Hamas, the Islamist group dominant in Gaza, has neither confirmed nor denied holding him.
"We have urged them, implored them, to use their influence to do whatever they can to get that soldier returned," a senior State Department official said.
Turkey's foreign minister said his country would do its best to help, but that reinstating the truce should be the priority.
Mr Ban also condemned Hamas' reported violation of the ceasefire and demanded the release of the soldier.
The ceasefire, which began at 8am (5am GMT), had prompted Palestinian families to trek back to battle-devastated neighbourhoods where rows of homes have been reduced to rubble. It was to be followed by Israeli-Palestinian negotiations in Cairo on a longer-term solution.
A senior Egyptian Foreign Ministry official said the talks would still begin tomorrow.
The Israeli military said that 90 minutes into the truce, militants attacked soldiers searching for tunnels in the southern Gaza Strip used to infiltrate fighters into Israel.
"Out of a tunnel access point or several, terrorists came out of the ground. At least one was a suicide terrorist who detonated himself. There was an exchange of fire," said Lieutenant-Colonel Peter Lerner, a military spokesman. Two of the soldiers were killed."
The Gaza Health Ministry said more than 70 people were killed by Israeli shelling after the incident.