Israel is facing growing international pressure, including from its top ally the US, to cease fire and refrain from its threatened offensive against Rafah.

Hamas was reviewing a proposal that would see a six-week truce and Israeli women and child captives freed in exchange for up to 900 Palestinian prisoners, a source from the group, close to the negotiations, said late on Monday.

The exchange will “include 100 who were sentenced to life imprisonment,” the Qatari Al Jazeera channel said, citing an anonymous source.

The first phase would also involve the return of displaced Palestinian civilians to northern Gaza and delivering 400-500 trucks of food aid daily to the territory amid the dire shortages of food and water due to the Israeli siege, the source said.

“Israel will allow the opening of the Gaza Strip's two main roads: Al-Rashid and Saleh Al-Din for the free movement of Gazans,” according to Al Jazeera.

The Qatari channel said the Israeli Army “will place its forces 500 metres away from them.”

Israel agreed to the American compromise proposal, which provides flexibility in the passage of Gazans to the northern Gaza Strip in exchange for solving the issue of releasing prisoners, a source involved in the talks told Israeli Kann News.

A day earlier, Israel announced its forces’ withdrawal from Khan Younis, north of Rafah, prompting thousands of displaced Palestinians to trudge back through an apocalyptic landscape of dust and destruction.

Negotiators had presented Hamas with a proposal for a ceasefire deal, and "it's going to be up to Hamas to come through," US National Security Council spokesman John Kirby said.

"Significant progress is made on several contentious points," Al-Qahera News TV reported, citing an unnamed high-ranking Egyptian source.

The Qatari and Hamas delegations left Cairo and were expected to return "within two days to finalize the terms of the agreement," it added, while the US and Israeli teams were also planning consultations.

“I think we are at an appropriate moment" to make a deal with the Islamist militants, Israel Defense Minister Yaov Gallant told Israeli army recruits on Monday.

"The relentless pressure on Hamas and the position of strength from which we come into this campaign allow us flexibility and freedom of action," he added, according to a statement from his office.

“A captive deal would be difficult, but it's doable and therefore needs to be made," Israeli opposition leader Yair Lapid said during his visit to Washington.