Israel's army said it was instructing Palestinian families in eastern Rafah to flee in preparation for an expected ground assault on the city which abuts Gaza's border with Egypt.
Residents of Rafah described emerging outside after a terrifying night in which around a dozen air strikes were carried out on Rafah, to find fliers falling from the sky telling them to "evacuate immediately".
"The army is working with intensive power against the terrorist forces near you," read a flier circulated in eastern Rafah.
"For your safety, the IDF (Israeli military) tells you to evacuate immediately towards the expanded humanitarian zone of al-Mawasi," it said, with a map indicating the location to the north of Rafah.
Osama Al-Kahlout, of the Palestinian Red Crescent Society in Gaza, told AFP that the areas designated for evacuation currently shelter some 250,000 people, many of whom have already been displaced from other areas in the Gaza Strip.
"The evacuation process has begun on the ground, but in a limited manner," he said.
An Israeli militark spokesman, when asked how many people should move, said: "The estimate is around 100,000 people."
About 1.2 million people are currently sheltering in Rafah, according to the World Health Organisation, most having fled there during the seven-month war between Israel and Hamas Palestinian militants.
Israeli soldiers killed
Amid pouring rain, some of those sheltering in Rafah said they had begun packing up their things from the densely packed tents and preparing to leave even before Israel's directive arrived.
"Whatever happens, my tent is ready," a resident told AFP.
But others said the area they were being told to flee to was already overcrowded, and they did not trust that it would be safe.
Abdul Rahman Abu Jazar, 36, said he and 12 family members were in the designated evacuation area.
Jazar and his family did not know what to do, he said, because the "humanitarian zone" they were told to head for "does not have enough room for us to make tents because they are (already) full of displaced people".
"Where can we go? We do not know," he told AFP.
"There are also no hospitals and it is far from any services many need," he said, adding that one of his family members relied on dialysis at the Al-Najar hospital, in the area of Rafah instructed to evacuate.
"How will we deal with her after that? Should we watch her die without being able to do anything?"
An Israeli military spokesman told reporters that the evacuation "is part of our plans to dismantle Hamas ... we had a violent reminder of their presence and their operational abilities in Rafah yesterday".
On Sunday, four Israeli soldiers were killed and others wounded, the army said, when a barrage of rockets was fired towards the Kerem Shalom border crossing between Israel and Gaza.
The army said the rockets were fired from an area adjacent to Rafah.
'No credible humanitarian plan'
International aid organisations have voiced alarm at the expected invasion of Rafah.
"From the humanitarian perspective, no credible humanitarian plan for an attack on Rafah exists," said Bushra Khalidi, advocacy director for Oxfam in the Palestinian territories.
She said she could "not fathom that Rafah will happen", asking where displaced Palestinians will go "when most of their surroundings have been reduced to death and rubble?"
Gaza's bloodiest-ever war broke out following Hamas's unprecedented October 7 attack on Israel which resulted in the deaths of more than 1,170 people, mostly civilians, according to an AFP tally of Israeli official figures.
Militants also seized some 250 hostages, with Israel estimating that 128 of them remain in Gaza, including 35 whom the military says are dead.
Israel's retaliatory offensive, aimed at destroying Hamas, has killed at least 34,683 people in Gaza, mostly women and children, according to the Hamas-run territory's health ministry.
