Israel has agreed to halt its action in Gaza a week after the latest bout of fighting began.
With US Secretary of State Hillary Clinton in the region to push for a ceasefire, Israel has accepted a truce deal to apply from 7pm on Wednesday evening. The deal has been confirmed by Egypt's Foreign Minister Mohammed Kamel Amr, although rocket fire has not yet halted, with reports of damage in Be'ersheva.
The Israeli Prime Minister said on Twitter that he had spoken to President Obama and "accepted his recommendation to give [the] Egyptian proposal for a ceasefire a chance". He added that "Israel will take all necessary steps to defend the citizens of Israel".
Mrs Clinton announced the ceasefire, saying that now was a "critical moment for the region".
"Egypt's new government is assuming the responsibility and leadership that has long made this country a cornerstone of regional stability and peace," she said. "The US welcomes the agreement today for a ceasefire in Gaza - for it to hold the rocket attacks must end and a broader calm must return."
"In the days ahead the US will work with partners across the region to consolidate this progress, improve conditions for the people of Gaza, provide security for the people of Israel."
The fighting had continued earlier today, with more than a dozen people injured in the first bomb explosion in Tel Aviv in nearly six years.
The bomb, which was praised by Hamas officials, but for which the Al-Aqsa Brigades, linked to Fatah, claimed responsibility, struck a bus in central Tel Aviv at lunchtime. Three people were severely injured.
Israel also continued to conduct airstrikes over Gaza in response to sustained rocket fire over the border, with around 116 fired at civilian populations today alone. Up to 13 Palestinians are thought to have died in the strikes today, bringing the death toll, including terrorists, to 152.
Foreign Secretary William Hague welcomed the agreement and urged all sides to uphold their commitments. He thanked President Mohammed Morsi and the Egyptian government, along with Mrs Clinton and UN Secretary General Ban Ki-moon, for their efforts to forge a deal.
"This ceasefire is an important step towards a lasting peace," said Mr Hague. "The priority now must be to build on the ceasefire and to address the underlying causes of the conflict, including more open access to and from Gaza for trade as well as humanitarian assistance, and an end to the smuggling of weapons.
"Above all, the loss of life over the past week has shown the urgent need for a return to negotiations on a two state solution to resolve the Israeli-Palestinian conflict.
The UK will work urgently with the US, the EU, our other international partners and with Israel and the Palestinian Authority, calling for a new initiative to restart the peace process before the window for a two state solution closes."