Relatives lit 138 branches with each candle representing a hostage who is still missing.
It came after 110 hostages were released during a temporary ceasefire between Israeli forces and the militant group.
Israel has since resumed its bombing of Gaza, with the country's forces saying they are now operating “in the heart of” the territory’s second-largest city as it steps up its war on Hamas.
The United Nations has warned that “an even more hellish scenario is about to unfold in the Gaza Strip” with Israeli airstrikes pummelling the area.
A British war surgeon who works for the International Committee of the Red Cross (ICRC) has described harrowing details of patients' injuries at the European Hospital inside the southern Gaza city of Khan Younis.