A ceasefire between Israel and Gaza militants took effect on Saturday evening after five days of intense cross-border exchanges.
The conflict has claimed the lives of at least 33 Palestinians in the Gaza Strip and two Israelis.
The truce was scheduled to begin at 10pm local time (7pm GMT), Egyptian and Palestinian sources said.
However, in the 30 minutes leading up to that time, numerous rockets were launched from Gaza towards Israel, instigating renewed air strikes, as reported by AFP correspondents in the area.
Despite these last-minute attacks, most of the rockets were successfully intercepted by Israel's air defences.
A few more rockets were fired after 10pm, which were met with further Israeli strikes before the situation started to show signs of calming.
After days of deserted streets, hundreds of people in Gaza began to venture out. Two rockets were launched from Gaza after 11pm local time, although the Israeli army said there were no victims.
The truce, the result of Egypt's mediation, has been agreed to by all involved, an Egyptian security official told AFP.
The ceasefire agreement has been confirmed by Palestinian and Israeli government sources.
The Israeli government thanked Egyptian President Abdel Fattah El Sisi for his role in brokering the truce.
Mohamad Al Hindi, an Islamic Jihad leader in Gaza, announced the ceasefire, which came after five days of heavy fighting.
The news broke on Al Kahera Wal Nas channel.
“Now, this agreement has been reached thanks to continuous Egyptian effort. We appreciate this effort,” Mr Al Hindi said.
Washington welcomed the ceasefire.
"We are grateful for the critical diplomatic efforts of President Abdel Fattah El Sisi and senior Egyptian officials, as well as Amir Sheikh Tamim Bin Hamad Al Thani of Qatar," said White House spokeswoman Karine Jean-Pierre.
She said the US had worked "closely with regional partners" to help establish the break in hostilities.
Despite the agreement, tension remains high.
On Saturday, a Palestinian labourer was killed by shrapnel from a rocket attack in Israel, and another was severely wounded.
Inside Gaza, Israeli air strikes have caused at least 33 deaths, including 14 civilians, and more than 147 injuries, as reported by Palestinian health officials.
Adding to the volatile situation, the Israeli military on Saturday launched a raid on the Balata refugee camp near Nablus in the occupied West Bank, resulting in the deaths of two Palestinians.
The two Palestinians were killed when Israeli forces opened fire on a group of gunmen who were shooting at them, the military said.
In a separate incident near Jenin, Israeli police shot and killed a suspected Palestinian assailant.
According to AP, the Israeli military has reportedly targeted locations in Gaza, including a flat belonging to Islamic Jihad commander Mohammed Abu Al Atta.
Islamic Jihad, in response, has launched barrages towards southern Israel, prompting the evacuation of hundreds of residents near the border.
The Israeli military said the flat harboured militants who had planned attacks against Israeli soldiers and manufactured improvised explosive devices.
Earlier today, the Israeli military said on Twitter that several PIJ targets in Gaza were hit during Friday night, including rocket and mortar launching sites and two command centres operated by senior militants identified as Mohammed Abu Al Ata and Khaled Azzam.
The Twitter posts were accompanied by grainy black-and-white footage showing explosions and clouds of smoke rising from bombed sites.
National Security Adviser Tzachi Hanegbi said on Saturday that Israel's top priority was maintaining its attacks on the Gaza militants.
"We're not holding ceasefire talks," Mr Hanegbi said at a municipal event near Jerusalem.
Six PIJ commanders have been confirmed killed since Tuesday, when Israeli forces launched a campaign against the group, accusing it of planning attacks.
PIJ, the largest armed faction in Gaza after the ruling Hamas group, has since fired almost 1,000 rockets, some deep into Israel. One woman was killed on Thursday when an apartment was struck by a rocket in a Tel Aviv suburb.
The exchange of fire across the Israel-Gaza border extends more than a year of resurgent Israeli-Palestinian violence that has claimed the lives of more than 140 Palestinians and at least 19 Israelis and foreigners since January.
Israeli forces have launched repeated raids targeting suspected Palestinian militants in the West Bank since a spate of attacks in Israel early last year.