Two residents of the area who spoke with ‘The Associated Press’ by telephone said they saw a small group of militants firing mortar rounds from a street near the school, where 350 people had gathered to get away from the shelling. They spoke on condition of anonymity for fear of reprisal.

Majed Hamdan, an AP photographer, rushed to the scene shortly after the attacks. At the hospital, he said, many children were among the dead.

“I saw women and men - parents - slapping their faces in grief, screaming, some of them collapsed to the floor. They knew their children were dead,'' he said. “In the morgue, most of the killed appeared to be children. In the hospital, there wasn't enough space for the wounded.''

He said there appeared to be marks on the pavement of five separate explosions in area of the school.

An Israeli defense official, speaking on condition of anonymity because he was not allowed to make the information public, said it appeared the military used 120-mm shells, among the largest mortar rounds.

UN officials demanded an investigation of the shelling. The carnage, which included 55 wounded, added to a surging civilian toll and drew mounting international pressure for Israel to end the offensive against Hamas.

At a news conference in Sharm-el-Sheik, Egypt, Egyptian President Hosni Mubarak said the truce proposal offered by him and French President Sarkozy envisioned an immediate end to combat, so humanitarian supplies can safely enter Gaza.

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