Turning the full force of Israel's military might on his northern neighbour, the Prime Minister, Benjamin Netanyahu said he would "strike" Hizbollah "and will continue striking with much force".
As Israeli warships pounded targets south of Beirut and jets bombed Baalbek in the east of Lebanon, the danger grew of extensive civilian casualties on the ground, and of drawing in Israel's neighbour, Syria.
Israel's Defence Minister, Moshe Arens, standing alongside the army chief and the Prime Minister at a news conference, said the campaign had begun with air strikes on Hizbollah targets north of Israel's south Lebanon occupation zone. "This evening the army started a response that I hope will be understood properly by all those who must understand our response," Mr Arens said.
Witnesses reported seeing troop movements along the border with Lebanon.
Mr Netanyahu said the campaign would expand according to Israel's assessment of the situation. "We have carried out a strike on the Hizbollah and will continue striking with much force," he said.
The government ordered 200,000 people in the north of Israel to go into bomb shelters in preparation for expected attacks by the guerrillas in the form of Katyusha rockets.
People in northern Galilee were told to stop preperations for the religious holiday of Purim and to take refuge underround instead, as they have done in the past
The killing of 38-year-old General Erez Gerstein in an ambush has shocked Israel's military establishment.
The guerrillas detonated bombs close to a convoy carrying General Gerstein, killing him, two other Israeli soldiers and an Israeli journalist.
The general was travelling in an armour-plated Mercedes four miles from the Israel's northern border when the car was torn apart by the blast.
The Israeli army has been fighting Hizbollah in the zone occupied by Israel in south Lebanon for more than 10 years.
"Israel could not tolerate this kind of repeated attack on its territory, on its citizens and on its soldiers.," Mr Netanyahu said. The scope of Israeli retaliation will become clear over the next few days. In 1996, Israel launched a prolonged bombardment of southern Lebanon, which led to the flight of most of its population and the death of some 200 Lebanese civilians.
Israel is only 10 weeks from an election and the government will not want to be accused of weakness.
The death of General Gerstein follows another Hizbollah ambush last week which killed the commander of an elite paratroop unit and two of his officers. Israeli officials officials admit that Hizbollah has become more skilled in recent years, fielding 600 highly experienced guerrillas.
An ominous development for Israel is that Hizbollah has highly accurate information about the movement of Israeli commanders and their units.
On several occasions Israeli forces intending to ambush Hizbollah have been caught by surprise themselves. Eighteen months ago 11 members of a naval commando force were wiped out when they launched a deep penetration raid.
The ambush of General Gerstein's car was extremely elaborate. It was the first in a four-vehicle convoy when 10 bombs, some hanging from trees, were exploded simultaneously killing all the men inside the Mercedes instantly. Hizbollah then laid down a mortar barrage on nearby positions of the Israeli-backed South Lebanon Army to cover their retreat.
General Shaul Mofaz, the Israeli chief of staff, said Israel would attack the infrastructure of the Hizbollah organisation without injuring civilians.
The death of a senior Israeli commander will affect the Israeli election in May, propelling the Israeli presence in Lebanon forward as an issue. Some 63 per cent of Israelis said in a recent poll that they thought the government was not doing enough to resolve the Lebanon problem, but only a minority favour a unilateral withdrawal. Israel lost only 21 soldiers in Lebanon last year.
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