Among the Cabinet's decisions was to halt the supply of electricity, fuel and goods to the Gaza Strip.
As Israel readied its response to Saturday's attacks, four divisions of reservists were being deployed to the Gaza border, joining the 35 battalions already deployed to the area, the army said.
Hamas killed at least 350 Israelis and wounded more than 1,800 on Saturday in a massive offensive launched from the Gaza Strip, including firing thousands of rockets and sending dozens of terrorists to infiltrate the Jewish state.
Of the 1,864 wounded, 19 remain in critical condition, the Israeli Health Ministry announced on Sunday morning. In addition, 326 Israelis sustained severe wounds, while 359 were moderately wounded.
According to the Health Ministry's most recent figures, 821 people suffered light injuries, 20 were treated for anxiety and another 223 are under medical supervision.
Hamas claims to have taken 163 Israeli captives to Gaza. Channel 13 reported late Saturday afternoon that Israel has confirmed that at least 11 people have been taken hostage in the Hamas-ruled enclave.
Overnight Saturday, Palestinian terrorist groups in the Gaza Strip continued to fire rockets at Israel's southern region, with a direct hit reported on Ashkelon's Barzilai Medical Center. The projectile struck a bridge between hospital buildings and no casualties were reported, according to Channel 12.
Twenty-eight Israelis were hurt in rocket attacks overnight, The Magen David Adom emergency service announced, with two listed as being in serious condition.
Meanwhile, security forces, including 35 IDF battalions, continued their search for Hamas infiltrators throughout southern communities. Following a day-long standoff, hostages were freed in Kibbutz Be'eri and Ofakim.
Control was also regained over the area surrounding the police station in Sderot, where 10 Hamas terrorists were killed after the Israel Police ordered the building destroyed.
The Israeli Navy announced its sailors had killed five Palestinian terrorists hiding on Zikim Beach near the border with Gaza.
"We neutralized most of the significant battles in the [Gaza] Envelope and began to evacuate residents. We have long days ahead of us," the IDF Spokesperson told local media on Sunday.
The IDF gained control over 29 infiltration points along the border fence and at sea, he said, noting that hundreds of terrorists had been killed and dozens captured.
"There were battles in which commanders and fighters fought heroic battles against terrorists, and some of them also fell," added the spokesperson as he announced that at least 26 Israeli soldiers were among those killed during the fighting.
The Israel Police said 30 of its officers had been killed since Saturday morning. "We are far from announcing that we have succeeded in eliminating all the terrorists who entered Israeli territory," Ynet quoted police spokesperson Eli Levy as saying.
On Israel's northern front, the IDF hit targets in southern Lebanon with artillery on Sunday morning, after Hezbollah terrorists there fired mortars at the Jewish state. There were no reports of casualties or damage.
Hezbollah claimed responsibility for Sunday’s fire, saying it targeted three Israeli military sites in solidarity with the “Palestinian resistance.”
In Judea and Samaria, Israeli troops arrested 19 Hamas operatives.
