Shrapnel from an Israeli strike in Rafah on Sunday night may have ignited a fuel tank, starting a fire that engulfed tents housing displaced Gazans and leading to dozens of civilian deaths, Israeli officials have told the Biden administration.

A US official told CNN that according to the Israelis, a precision munition was used in the strike.

“We can’t confirm that but it’s what Israel shared with us,” the official said, adding that “we assume we will learn more once Israel completes its investigation.”

ABC News cited a US official as saying that the fuel tank was located around 100 meters (330 feet) from the area targeted in the airstrike.

The Israel Defense Forces said on Monday that it had opened an operational investigation into the airstrike and the civilian deaths that resulted, which Israeli Prime Minister Benjamin Netanyahu called "a tragic mistake."

More than 35 civilians were killed after a fire that broke out after the IAF attack, an Israeli government spokesperson said on Monday.

In a statement to the Knesset, Netanyahu said: “Despite our utmost efforts not to harm innocent civilians, last night, there was a tragic mistake.

A White House National Security Council spokesperson told Axios that the Biden administration is actively engaging with the Israel Defense Forces and other partners on the ground in Gaza to determine what happened.

"The devastating images following the IDF strike in Rafah last night that killed dozens of innocent Palestinians are heartbreaking. Israel has a right to go after Hamas...but as we've been clear, Israel must take every precaution possible to protect civilians," the spokesperson said.

According to the IDF, the strike took place outside of the Al-Mawasi humanitarian zone, to which nearly a million people have been evacuated during the weeks-long Rafah operation.

The IDF posted a map to X showing the location of the strike in relation to the humanitarian area, writing that "contrary to Hamas's lies and misinformation, the strike did not take place in the Al-Mawasi Humanitarian Area."

Two senior Hamas terrorists were killed in the strike, which targeted a Hamas compound in the area of Tel Sultan in northwestern Rafah.

The targets of the strike were named as Yassin Rabia, the head of Hamas’s West Bank headquarters, and Khaled Nagar, a senior official in the terror group’s West Bank wing.

Rabia and Nagar carried out terrorist attacks in the early 2000s in the West Bank that killed and wounded Israeli soldiers and civilians, the military said. They also transferred funds for terrorist activities in the West Bank and planned and directed attacks there.

According to the IDF spokesperson, the strike was carried out in accordance with international law, was based on intelligence and executed using precision weaponry.

Meanwhile the IDF is continuing its offensive in Rafah, the last Hamas bastion in southernmost Gaza along the Egyptian border.

According to Palestinian reports, IDF ground troops were advancing, with tanks positioned in the Tel Sultan neighborhood of northwestern Rafah, marking the first ground operation in that part of the city.

Tel Sultan is where one of the four Hamas battalions in Rafah is located, with the others being in Yabna (south), Shaboura (north) and east Rafah, all areas where the IDF has been active in recent weeks.