A ceasefire came into effect yesterday in and around Gaza after a week of cross-border violence between Israel and Palestinian militants that killed at least 160 people.
Gaza City's streets were dark and deserted in the minutes after the ceasefire began at 1900 GMT, and Israeli drones could be heard overhead, but soon after people poured out onto the streets to hail the "victory."
Heavy celebratory gunfire could be heard throughout the Gaza Strip, and residents also released fireworks into the night sky, where Israeli drones could still be heard buzzing overhead.
"The resistance has triumphed," some shouted, alongside chants of "God is greatest."
Foreign Minister Mohammed Kamel Amr of Egypt, which brokered the ceasefire in days of marathon talks, announced the cessation of hostilities at a joint news conference in Cairo with US Secretary of State Hillary Clinton.
The accord, a copy of which was obtained by AFP, calls on Israel to "stop all hostilities... in the land, sea and air including incursions and targeting of individuals" and urges the Palestinian factions to end "rocket attacks and all attacks along the border".
If it holds, within 24 hours, Israel would be required to start implementing procedures to open Gaza's border crossings and allow the movement of people and goods.
"This is a critical moment for the region," Hillary said. "In the days ahead, the United States will work with partners in the region to consolidate this progress."
Nearly 24 hours after a truce had been expected to take hold, and after a day of violence that killed another 18 Palestinians, Israeli Prime Minister Benjamin Netanyahu's office said he was prepared to give peace a chance.
"Netanyahu spoke with (US) President Barack Obama and agreed to his recommendation to give a chance to an Egyptian proposal for a ceasefire and thereby give an opportunity for the stabilisation of the situation and a calming of it," said a statement.
The agreement came after a day of shuttle diplomacy -- led by Hillary and UN chief Ban Ki-moon -- which was marred by more deadly cross-border violence between Israel and militants in Gaza.
Ban Ki-moon welcomed the truce but said that details of the deal still need to be ironed out.
"We are encouraged and relieved that they have reached this ceasefire," Ban told reporters after meeting with King Abdullah II hours after he flew to Jordan after engaging in shuttle diplomacy between Jerusalem and Ramallah aimed at bolstering the peace efforts.
Hopes for a truce appeared to have been faint just hours earlier as a blast tore through a bus in Tel Aviv and Israel hit back with deadly raids on Gaza City and elsewhere in the coastal Palestinian territory.
The blast, which injured 17 people, occurred very close to the Israeli defence ministry and was quickly denounced by Netanyahu's spokesman, who tweeted: "This was a terrorist attack".
Condemnation poured in, with Washington branding it "outrageous," Moscow denouncing it as a "criminal," and France and Germany calling for an urgent and lasting ceasefire in Gaza.
Soon after, another six Palestinians were killed in air strikes on Gaza City.
One of the strikes hit the tower housing AFP's offices, killing a toddler in a neighbouring building, a health ministry spokesman said. No AFP journalists were inside at the time.
Another air strike shortly afterwards on central Gaza killed a four-year-old girl, medics said.
Israel launched its offensive on November 14 with the targeted killing of a Hamas military chief, hitting more than 1,500 targets. At least 155 Palestinians have been killed, and five Israelis have died.
Gaza militants fired more than 1,500 rockets at the Jewish state, killing three people and injuring dozens, and Israel's vaunted Iron Dome anti-missile system intercepted more than 420 of them.