Israeli Prime Minister Benjamin Netanyahu said on Wednesday that the fighting with Gaza's Islamic Jihad group "could take time" in the second day of escalating tension in the region.

"We are continuing to hit Islamic Jihad after eliminating its senior commander," Netanyahu said at the start of a special cabinet meeting, referring to Tuesday's predawn strikes on the home of Baha Abu al-Atta, a senior Palestinian Islamic Jihad commander, which killed al-Atta and his wife.

Netanyahu said that al-Atta "was responsible for most of the terror attacks emanating from the Gaza Strip in the last year and he was planning to carry out more attacks in the very next days."

He said that Israel is not interested in further escalation but warned the Islamic Jihad that the Israeli army "will continue to strike them with no mercy" if rocket fire towards Israel continues.

Netanyahu addressed the citizens of Israel and said the escalation "could take time" and asked them to stay vigilant.

The killing of al-Atta triggered a spate of violence, including at least 250 rockets fired at central and southern Israel and dozens of Israeli airstrikes in Gaza.

At least 16 Palestinians have been killed and 50 more were wounded in Gaza since Tuesday, according to Gaza's health ministry figures.

Meanwhile, no fatalities were reported in Israel and two people were injured by shrapnel, according to the country's MDA medical emergency service.