Israeli forces said on Thursday they had raided the biggest functioning hospital in Gaza, as video posted online showed chaos, shouting and the sound of shooting in darkened corridors that were filled with dust and smoke.
Israeli military spokesperson Rear Admiral Daniel Hagari described the raid on Nasser Hospital as "precise and limited" and said it was based on credible information that Hamas was hiding in the facility, had kept hostages there and that bodies of hostages may still be there.
A spokesperson for Hamas called Israel's claim "lies".
Health authorities in the Hamas-run enclave said Israel had forced out displaced people and families of medical staff sheltering in Nasser Hospital, with some 2,000 arriving in the southern border city of Rafah overnight and some pushing north to Deir Al-Balah in central Gaza.
The UN humanitarian office had said on Wednesday that Nasser Hospital was besieged by Israeli forces with allegations of sniper fire at the facility, endangering the lives of medics, patients and thousands of displaced people.
The medical charity MSF said people ordered by Israel to evacuate the hospital faced an impossible choice to stay "and become a potential target" or leave "into an apocalyptic landscape" of bombings.
Fighting at the hospital comes as Israel faces growing international pressure to show restraint in its Gaza war, after vowing to press its offensive into Rafah, the last relatively safe place for civilians in the enclave.
Attacks that have destroyed the majority of Gaza's medical facilities have caused particular concern throughout the conflict, including Israeli raids on hospitals in other cities, shelling in the vicinity of hospitals and the targeting of ambulances.
As massive bombardment destroyed swathes of residential districts and forced most people from their homes, hospitals quickly became the focus for displaced people seeking shelter around buildings they thought more likely to be safe.
Israel accuses Hamas of regularly using hospitals, ambulances and other medical facilities for military purposes, and has aired footage taken by its troops that it says shows tunnels containing weapons below some hospitals.
The Israeli military said on Thursday it had apprehended a number of suspects at the Nasser Hospital and that its operations there were continuing.
Senior Hamas official Sami Abu Zuhri said Israel's statement accusing the group of hiding fighters or keeping hostages at the hospital was "lies". He added that "all previous Israeli allegations against hospitals had proven to be false".