About 125 rockets were fired from the Gaza Strip at southern Israel over the past month, 45 of which in the last 24 hours.
Government officials said on Thursday that Israel sent messages to Hamas through different channels, warning the organization that if the situation in Gaza escalates, the IDF will severely hit Hamas and launch a significant operation in the Strip.
Despite that, the message also said that just like in previous rounds of violence, Israel would respond to calm with calm.
Shortly before midnight, after a two-hour break in rocket fire, it renewed again. A Code Red siren was sounded in the Sdot Negev and Sha'ar HaNegev Regional Councils, and a rocket fell in an open area.
Before that, 15 rockets and mortar shells were fired within an hour, and one soldier was lightly wounded in Eshkol from shrapnel to his leg. In addition, two fires broke out in Sderot as a result of the rocket fire, and light damage was caused to buildings from rockets that fell in Sdot Negev.
The cabinet met to discuss the escalation in recent days - that include both rockets from Gaza and violent clashes in East Jerusalem. The cabinet discussed the risks a widespread operation in Gaza poses, among them rocket fire at Tel Aviv.
A government source said that "Israel is still in the stage of studying the situation, but it's still unclear whether the messages passed on to Hamas have been received and understood."
Prime Minister Benjamin Netanyahu said Thursday night that if "firing toward our residents in the south continues, then our bolstered forces there will act forcefully".
Due to the continuous mortar fire, Eshkol residents were instructed to enter their safe rooms and shelters. In Sdot Negev, however, there were no special instructions and activities will continue as normal.
The thing that signifies the escalation most of all, and indicates there are cracks in Israel's deterrence, is that, according to the IDF and Shin Bet, over 125 rockets have been fired over the past month from Gaza. Despite the increase in rocket fire, the range hasn't been expended, and at present only communities close to the border are being hit. Hamas, however, threatened to increase that range.
A year and a half after Operation Pillar of Defense, it's hard to ignore the situation in Sderot and its surrounding communities, that were hit with some 45 rockets in the past 24 hours.
Since the beginning of Operation Brother's Keeper in the West Bank on June 12, 81 rockets have been fired at Israel. Thirteen of which were intercepted by the Iron Dome missile defense system.
Compared to that, since early 2013 - after the end of Operation Pillar of Defense - and until the end of May 2014, only 103 rockets and mortar shells have been fired at Israel.
Terrorists at the Strip have been avoiding firing at Beersheba or Ashdod, and this perhaps explains Israel's measured response so far to the rocket fire.
The defense establishment is not keen on throwing away the understandings reached at the end of Operation Pillar of Defense so quickly, and continue allowing Palestinians to farm their lands almost to the border fence, or fishing in a large area of the Gaza shoreline.
Despite the efficacy of the Iron Dome, some of the rockets in the past week fell in inhabited areas of Sderot due to the complexity of intercepting rockets over a city this large that is so close to the border.
The Air Force bolstered the active defense system not only in the Gaza border communities, but in other areas in southern Israel and across the country, out of concern the rockets' range will expend.
The gravity of the terror attacks coming from the Gaza Strip has also been slowly on the rise. Seven bombs have been neutralized or exploded near IDF troops in the first four months of the year. This compared to 16 cross-border fire incidents or bombs in all of last year.
While the IDF and Hamas have both been sending messages they are not interested in escalation, the army says Hamas has joined the rocket fire.
Tensions also increased in East Jerusalem, where a second day of clashes in Shuafat concluded with the light injury of one policeman.
In the midst of those clashes, the Jerusalem police has completed its preparations for the first Friday of Ramadan. Police is expecting clashes at the end of Friday prayers and thousands of policemen will be deployed from the early morning hours in East Jerusalem and the Old City to keep the peace.
Due to the kidnapping and murder of the three Israeli teens, police will limit entrance of Palestinians to the Temple Mount. Only Palestinian men over 50 and women over 45 will be allowed into the complex, while all Hebron residents will be denied entry. The same security arrangement will apply to all Fridays of Ramadan.
The IDF was also preparing for Friday. The Central Command has bolstered troops to secure prayers. A large force of IDF, Border Police and Police will be deployed along Highway 60 that leads from Hebron to Jerusalem.
Yoav Zitun, Ilana Curiel, Noam (Dabul) Dvir, Attila Somfalvi contributed to this report.