At least 11 Palestinians were killed and 40 others were injured after Israeli forces targeted a tent camp in a designated safe zone in Rafah, according to the Palestinian WAFA news agency.
According to the report, tents in al-Mawasi, which lies directly on the Mediterranean coast, were hit in the attack.
Many Palestinians have taken refuge in the encampment since the Israel Defense Forces (IDF) began operations in nearby Rafah at the start of May and designated al-Mawasi a safe zone.
Asked to comment, the IDF said it had no knowledge of an attack by Israeli forces on al-Mawasi on Friday.
Since May 7, tanks have advanced in several districts of Rafah, and forces remained in control of the entire border line with Egypt and the Rafah crossing, the only gateway for most of Gaza's 2.3 million people with the outside world.
One resident, who spoke to Reuters via a chat app, said some bulldozers in the Shakoush area were piling up sand for Israeli tanks to station behind.
"Some families live in the area of the raid and are now besieged by the occupation forces," he told Reuters.
"The situation there is very dangerous and many families are leaving towards Khan Younis, even from the Mawasi area as things became unsafe for them," said the man, who moved northward overnight.
Just before midnight, an Israeli airstrike hit the Palestinian Civil Emergency Service headquarters in Al-Nuseirat camp, central Gaza Strip, killing three members, the service said. This brought to 74 the number of staff killed by Israeli fire since Oct. 7.
More than eight months into Tel Aviv's pounding on Gaza, triggered by Hamas' incursion on southern Israel on Oct. 7, aid officials say the enclave remains at high risk of famine, with nearly half a million people facing "catastrophic" food insecurity.
Claiming to have the "most moral army in the world," Israel has been incessantly targeting safe zones, schools, refugee camps, areas of worship, bakeries, aid convoys and more, in grave violation of international law.