Israel and the militant Islamic Jihad group in Gaza appeared to have reached a cease-fire on Thursday to end two days of heavy fighting that killed at least 34 Palestinians and paralyzed parts of Israel.

Islamic Jihad spokesman Musab al-Berim said the cease-fire went into effect at 5:30 a.m.

Al-Berim said the cease-fire was based on a list of demands presented by his group late Wednesday, including a halt to Israeli targeted killings of the group's leaders.

An Israeli military spokesman says the two-day round of fighting in Gaza "is over,'' confirming a cease-fire announced earlier by the Jihad militants.

Spokesman Lt. Col. Avichay Adraee said in a tweet on Thursday morning that the operation had ended with Israel having targeted 25 Gaza militants, most of them from the Islamic Jihad group.

Adraee tweeted that the Israeli airstrikes targeted "terrorist infrastructure'' above and below ground as well as Islamic Jihad naval positions.

The fighting broke out early Tuesday after Israel killed a senior commander of the Jihad group who was said to be behind a string of rocket attacks and who Israel said was believed to be planning a cross-border infiltration.

The rare targeted killing by Israel sparked the heaviest fighting with Gaza militants since May. Islamic Jihad fired some 400 rockets toward Israel, while Israel responded with scores of airstrikes.

Israeli Foreign Minister Israel Katz said the policy of targeted killings had "proved itself'' to be effective and that it would continue, despite word of the cease-fire.

"Everyone who was a top military official, who was set to carry out and was involved in terror or rocket firing against Israel was eliminated,'' he told Israeli Army Radio. "And we intend to continue with this.''

Gaza's ruling Hamas militant group, which is much larger and more powerful than Islamic Jihad, stayed out of the fighting, indicating it would be brief.

Palestinian officials reported 34 deaths, including a 7-year-old boy and six members of a single family. At least 16 of the dead were militants.

The rocket fire crippled life across southern Israel and on Tuesday, also in the country's heartland in and around Tel Aviv, as nonstop air-raid sirens canceled schools and forced people to remain indoors. At least three people were lightly wounded from shrapnel or shattered glass. Most rockets landed in open areas or were shot down by Israel's Iron Dome military defense system.

Much of Gaza resembled a ghost-town, with almost no vehicles on the roads except for ambulances evacuating the wounded.

Shortly after al-Berim's announcement, at least two rockets were fired out of Gaza, setting off sirens in southern Israel. It was not immediately clear who fired the rockets or whether the launches were intentional or misfires caused by electronic timers.

But the Islamic Jihad said it was committed to ending the fighting, saying the fire was likely because word hadn't spread to all members about the halt to violence.

The Israeli military's Home Front command tweeted that it was lifting restrictions in certain areas but leaving them in place in the areas surrounding Gaza. In Gaza, cars could be heard back on the streets as the territory appeared to be springing back to life. Israeli military drones could still be heard buzzing overhead.

Late Wednesday, Islamic Jihad's leader, Ziad al-Nakhalah, announced three conditions for an end to the fighting: an end to targeted killings, a halt in Israeli shootings of protesters at weekly demonstrations along the Israeli border and easing a 12-year-old Israeli blockade that has devastated Gaza's economy.

Israel imposed the blockade after Hamas violently seized control of Gaza in 2007 from the Palestinian Authority. Israel considers Hamas and Islamic Jihad to be terrorist groups.

The killing of Bahaa Abu el-Atta on Tuesday coincided with a strike in the Syrian capital of Damascus that targeted another Islamic Jihad commander. Israel hasn't claimed responsibility for that attack and the commander was not killed, but the strikes stepped up Israel's regional conflict with Iran and its proxies.

The violence came at a touchy time in Israel, where Prime Minister Benjamin Netanyahu heads a caretaker government after two elections ended inconclusively and after he failed twice to form a governing coalition.

His main rival, former army chief Benny Gantz, is now trying to cobble together a government, but his chances appear slim. If he fails by next week, Israel could be on its way to an unprecedented third election in less than a year.

Lawmakers from across the political spectrum typically rally behind the government during a military operation, and Netanyahu has briefed Gantz before and during the violence, setting off speculation the conflagration may succeed to push the men toward an agreement.

The escalation also comes ahead of an expected indictment against Netanyahu for a number of corruption allegations.

During the months of election campaigning, the long-serving Israeli leader has sought to depict himself as the only leader capable of steering Israel through its myriad security challenges, painting Gantz as weak despite his military bona fides.

With the legal woes hovering, the latest round of violence could help to bolster Netanyahu's image.

*This story had been edited by Ahram Online