William Hague condemned rocket attacks on Israel from Gaza today, insisting militant group Hamas bore “principal responsibility” for spiralling violence.
The Foreign Secretary also urged Tel Aviv to reduce tension and avoid civilian casualties - but stopped short of demanding an end to its air strikes.
The intervention came amid a fresh wave of bloodshed following an Israeli attack that killed the leader of Hamas's military wing, Ahmed Said Khalil al-Jabari, yesterday.
Mr Hague said: "I am gravely concerned by the situation in Gaza and southern Israel and deeply regret the loss of civilian life on both sides. I call on all those involved to avoid any action which risks civilian casualties or escalates the crisis.
"Hamas bears principal responsibility for the current crisis. I utterly condemn rocket attacks from Gaza into southern Israel by Hamas and other armed groups.
"This creates an intolerable situation for Israeli civilians in southern Israel, who have the right to live without fear of attack from Gaza. The rocket attacks also risk worsening the plight of Palestinian civilians in Gaza, which is already precarious.
"Hamas and other armed groups in Gaza should cease attacks against Israel immediately. I call on those in the region with influence over Hamas to use that influence to bring about an end to the attacks.
"I also strongly urge Israel to do their utmost to reduce tension, avoid civilian casualties and increase the prospects for both sides to live in peace. It is imperative to avoid the risk of a spiral of violence. The escalation of the conflict would be in no one's interest, particularly at a time of instability in the region."
Mr Hague said the latest crisis underlined the urgent need for "progress toward a two-state solution which allows Israelis and Palestinians to live alongside each other in peace and security".
David Cameron is chairing a meeting of the National Security Council today which is expected to consider the wider implications for the region.
The conflict has been intensifying over recent weeks, but flared up dramatically in the wake of the Israeli strikes against senior Hamas figures.
Hundreds of rockets have been fired into Israel, with three people killed in the town of Kiryat Malachi - about 15 miles north of Gaza - this morning.
At least 11 Palestinians, including some civilians, are reported to have died over the past two days.
Israeli prime minister Benjamin Netanyahu has warned that his country is prepared to extend its operation against Hamas, sparking fears of a repeat of the ground incursion four years ago in which hundreds died.