Israeli troops pounded an eastern neighborhood of Gaza City with air and artillery strikes Sunday, trading fire with Hamas militants armed with antitank missiles and rocket-propelled grenades and sending a tide of panicked humanity streaming from the area.
Most of those fleeing left empty-handed, carrying only their children in their arms as gunfire and explosions reverberated around them.
The fighting, described as the heaviest of Israel's 13-day campaign in the Gaza Strip, killed at least 66 Palestinians, injured hundreds more and displaced tens of thousands, according to Palestinian health officials. Thirteen Israeli soldiers died, the Israeli military said.
More than 430 Palestinians have been reported killed overall, most of them civilians, according to the United Nations.
U.N. Secretary-General Ban Ki-moon called Israel's actions in the Shajaiya neighborhood "atrocious" and said it must do far more to protect civilians.
"Too many innocent people are dying," Ban said in Doha, Qatar, the first stop of a regional trip to try to bring an end to the fighting.
In an unguarded moment caught on an open microphone before an interview with Fox News, Secretary of State John F. Kerry appeared to express frustration Sunday with the Israeli campaign's mounting toll. "It's a hell of a pinpoint operation," he was heard telling an aide.
Asked about the comment in the interview, Kerry said he reacted "in a way that anybody does with respect to young children and civilians." But he defended Israel's right to go after a network of tunnels used by Hamas and its allies to strike at Israel.
He noted that Israel accepted an Egyptian cease-fire proposal that was rejected by Hamas, which controls Gaza. The Islamic militants say they will continue fighting until Israel and Egypt agree to lift a crippling blockade on the coastal enclave. Kerry was expected in Cairo on Monday to lend his support to the stalled talks.
Palestinian leaders accused Israel of war crimes. "What the brutal occupation forces have done today in Shajaiya in the Gaza Strip is a crime against humanity and a heinous massacre," Palestinian Authority President Mahmoud Abbas said in a televised address Sunday night. "We demand immediate international protection for our Palestinian people."
Israeli Prime Minister Benjamin Netanyahu said in a tweet that "Israel regrets any inadvertent strike on Palestinian civilians." But he defended the operation in a national address as vital to Israel's security.
Speaking earlier to ABC News, Netanyahu said the goal was to restore "a sustainable quiet." The next stage, he said, would be working with the international community to "demilitarize Gaza." He did not elaborate.
Israel took some of its worst military losses in years, with the Israel Defense Forces announcing that 13 soldiers were killed while fighting Hamas militants since the previous night. The losses brought the number of Israeli military dead in the Gaza campaign to 18. Two civilians have also been killed by projectiles fired from Gaza.
Israel's military did not describe how its soldiers died, but Hamas said its militants had struck an armored personnel carrier. According to Israeli media, seven were killed as the vehicle was hit with an antitank missile, and the rest died in the close-quarters combat that followed.
About 60 soldiers injured Sunday morning were airlifted to several hospitals around Israel.
There were unconfirmed reports of two Americans being among the Israeli dead, including a 24-year-old from Woodland Hills.
Late Sunday, the military wing of Hamas, the Izzidin al-Qassam Brigade, claimed to have captured an Israeli soldier, setting off celebrations in the Palestinian territories. Israel did not immediately confirm that one of its soldiers was missing, and Hamas has made similar claims in the past that were not true.
Hamas-allied militants who captured Israeli soldier Gilad Shalit in 2006 held him captive until 2011, when Israel agreed to free more than 1,000 Palestinian prisoners in exchange for his release.
The White House said President Obama had spoken to Netanyahu for the second time in three days to discuss the Gaza invasion. Obama "reiterated the United States' condemnation of attacks by Hamas against Israel and reaffirmed Israel's right to defend itself," a White House statement said. "The president also raised serious concern about the growing number of casualties, including increasing Palestinian civilian deaths in Gaza and the loss of Israeli soldiers."
Lt. Col. Peter Lerner, an Israeli military spokesman, said Shajaiya was targeted because it is a stronghold of Hamas and the source of 8% of the rockets fired at Israel. Netanyahu said more than 2,000 had been fired since July 8.