Israeli airstrikes pounded the southern suburbs of Beirut on Sunday, hours after a rocket attack on Haifa killed eight Israelis.
South of Beirut, 20 people were killed and 50 were wounded Sunday in an Israeli airstrike on the Lebanese port city of Tyre, according to Lebanese television.
Later Sunday, an Israeli warship struck the area of Beirut's airport with four missiles, setting on fire a fuel storage tank, The Associated Press reported, citing security officials who were not identified.
The militant group Hezbollah claimed responsibility for the attack on Haifa, saying it was responding to overnight Israeli airstrikes inside Lebanon.
Shortly after Haifa was hit, the head of Israel's northern command, Maj. Gen. Udi Adam, warned civilians in southern Lebanon to head north because "in two or three hours we are going to attack south Lebanon heavily."
CNN's Alessio Vinci described the scene in the southern part of Beirut as "utter destruction," with buildings collapsed and large areas devastated.
The Israeli military said the airstrikes hit buildings where Hezbollah members lived and worked.
The airstrikes reduced entire apartment buildings to rubble and knocked out electricity in parts of Beirut, the AP reported.
Earlier, journalist Anthony Mills said he heard at least six bombings near the Lebanese capital between 11 a.m. and noon (4 a.m. and 5 a.m. ET).
Lebanese officials said Sunday that 104 people have been killed and 286 wounded in the fighting between Israel and Hezbollah militants that began Wednesday.
A total of 12 Israeli civilians and 12 Israeli military personnel have been killed since Wednesday. More than 100 others have been wounded.
Eight Canadians were among those killed Sunday in southern Lebanon, a spokesman for Canadian Foreign Affairs Minister Peter MacKay said.
In the attack on Haifa, one of the Hezbollah rockets hit a railway depot in the city's industrial zone, killing at least eight and wounding 17 others -- six of them seriously -- Israeli medical services said.
Hezbollah leader Hassan Nasrallah said Sunday that his fighters still have plenty of weapons and the will to keep fighting.
"Our fighters are ready, and they love the confrontation and have the determination to defeat," he said in a televised address in Arabic to the Lebanese people.
"And as we surprised [Israel] in the sea, and as we surprised them in Haifa, we will surprise them with what's beyond Haifa," Nasrallah said.
He accused Israel of attacking civilian targets, while insisting that Hezbollah was patient and has aimed its rocket attacks only at the Israeli military.
"The enemy does not know our capabilities. ... We are still in the beginning," he said.
In Israel, Prime Minister Shimon Peres acknowledged that civilian casualties have occurred but said the Israeli military "are extremely careful" about distinguishing between Hezbollah and civilian targets.
"We are being attacked indiscriminately," he said.
Israeli Defense Minister Amir Peretz said the attacks on Lebanon will not end until Israel is sure "the reality will change" so there are no threats on Israel by Hezbollah.
Peretz spoke in Haifa hours after the Hezbollah rocket attack.
"Everyone who has attacked and harmed the city of Haifa and the Israeli home front will pay a very expensive and costly price for this," Peretz said.
Israeli Transportation Minister Shaul Mofaz said the missile contained Syrian ammunition.
"The Iranians supply Hezbollah with weapons and technology," said Mofaz, Israel's former defense minister. "Syria is taking part."
The weapon was a Katyusha rocket with a range of 35 to 40 kilometers (22-25 miles), Israel Defense Forces spokeswoman Miri Regev said. Haifa, Israel's third largest city, is about 35 kilometers south of the Lebanese border.
Iran rejected a similar Israeli assertion that it supplied Hezbollah the missile that struck an Israeli warship off the coast of Lebanon on Friday, killing four Israeli sailors.
The Israeli military found the bodies of three of the sailors Sunday. The body of the fourth sailor had been found the day before.
Rockets also hit the northern towns of Akko and Nahariya on Sunday, and residents of northern Israel were told to take cover in bomb shelters.
Israel on alert as far south as Tel Aviv
The Israeli military warned residents as far south as Tel Aviv to raise their level of awareness, as the country is on alert against conventional weapons, according to the Israel Defense Forces.
The Israeli military said Hezbollah has fired more than 450 rockets into northern Israel since Wednesday.
Speaking before his weekly Cabinet meeting, Israeli Prime Minister Ehud Olmert said the attack "will have far-reaching implications" on Israel's relationship with its "northern neighbors."
A spokesman for the Italian government said Lebanon has been given a list of Israeli conditions for a cease-fire that includes the release of two Israeli soldiers captured by Hezbollah, the withdrawal of the group from south Lebanon and an end to rocket attacks on Israel.
The conditions were relayed to Lebanese Prime Minister Fouad Siniora in a phone call by Italian Prime Minister Romano Prodi, according to Italian spokesman Silvio Sircana.
In Beirut's Parliament building, Siniora met during the afternoon with European Union Foreign Affairs and Security Chief Javier Solana; observers said they were likely discussing Sinior's calls for a cease-fire.
"The gates of hell have been opened on Lebanon," Siniora told CNN's "Late Edition" on Sunday.
He called Israel's actions "disproportionate," and predicted they would encourage the extremists.
In Saint Petersburg, Russia, the Group of Eight countries issued a statement expressing "deepening concern" about the situation, particularly "the rising civilian casualties on all sides and damage to infrastructure," and called for an end to the violence.
Despite the agreements expressed in the statement, the G-8 countries are divided over who is to blame and how to move forward, with France, Russia and Italy suggesting Israel went too far in its actions.
Hezbollah, which is backed by Syria and Iran, is considered a terrorist organization by the United States and Israel. The group holds 23 of the 128 seats in Lebanon's parliament.