Another Israeli bombardment on Thursday killed the Hamas security chief.

U.N. workers and Palestinian firefighters, some wearing bulletproof jackets, struggled to douse the flames and pull bags of food from the debris after the Israeli attack, which was another blow to efforts to ease the humanitarian crisis in the Gaza Strip. Dense smoke billowed from the compound.

U.N. Secretary-General Ban Ki-moon, who is in the region to end the devastating offensive against Gaza's Hamas rulers, demanded a "full explanation" and said the Israeli defense minister told him there had been a "grave mistake."

Israeli Prime Minister Ehud Olmert, who met with Ban later Thursday, said the military fired artillery shells at the U.N. compound after Hamas militants opened fire from the location. Three people were wounded.

"It is absolutely true that we were attacked from that place, but the consequences are very sad and we apologize for it," he said. "I don't think it should have happened and I'm very sorry."

The U.N. Security Council requested a briefing on the attack.

Interior Minister Said Siam was killed in an Israeli airstrike that flattened a home in Gaza City. Israel and Hamas both confirmed the death of Siam, who oversaw thousands of security agents and was considered to be among the militant group's top five leaders in Gaza.

Even as a top Israeli envoy went to Egypt to discuss a cease-fire proposal, the military pushed farther into Gaza in an apparent effort to step up pressure on Hamas. Ground forces thrust deep into a crowded neighborhood for the first time, sending terrified residents fleeing for cover. Shells also struck a hospital, five high-rise apartment buildings and a building housing media outlets in Gaza City, injuring several journalists.

Bullets also entered another building housing The Associated Press offices, entering a room where two staffers were working but wounding no one. The Foreign Press Association, representing journalists covering Israel and the Palestinian territories, demanded a halt to attacks on press buildings.

The army had collected the locations of media organizations at the outset of fighting to avoid such attacks.

In Washington, the Bush administration was racing in its final days to negotiate a last-minute deal on American support for Egyptian-led truce mediation efforts under which the U.S. would provide technical support and expertise to prevent Hamas from re-arming, said U.S. and Israeli diplomats.

It was not immediately clear if members of President-elect Barack Obama's or Secretary of State-designate Hillary Rodham Clinton transition teams were being advised of the talks, which could lead to a prominent and ongoing U.S. role in the truce.

The diplomats spoke on condition of anonymity due to the sensitivity of the negotiations.

Israel launched its war on Dec. 27 in an effort to stop militant rocket fire from Gaza that has terrorized hundreds of thousands of Israelis. Some 1,100 Palestinians have been killed, roughly half of them civilians, according to U.N. and Palestinian medical officials. Gaza health official Dr. Moaiya Hassanain said at least 70 people were killed or died of wounds throughout Gaza on Thursday.

Thirteen Israelis also have been killed since the campaign began. Israel says it will press ahead until Hamas halts the rocket fire and stops smuggling weapons into Gaza from neighboring Egypt.

Israeli police said 20 rockets hit southern Israel on Thursday, injuring 10 people. Five of the wounded were in a car that was struck in the city of Beersheba.

The U.N. compound struck Thursday houses the U.N. Works and Relief Agency, which distributes food aid to hundreds of thousands of destitute Gazans in the tiny seaside territory of 1.4 million people.

"I conveyed my strong protest and outrage to the defense minister and foreign minister and demanded a full explanation," said Ban, who arrived in Israel on Thursday morning from Egypt.

It had only that morning become a makeshift shelter for 700 Gaza City residents seeking sanctuary from relentless Israeli shelling, U.N. officials in Gaza said.

John Ging, director of UNRWA operations in Gaza, said the attack at the compound caused a "massive explosion" that wounded three people.

A senior Israeli military officer said troops opened fire after militants inside the compound shot anti-tank weapons and machine guns. The officer spoke on condition of anonymity pending a formal army announcement later in the day.

Ging, who was in the compound at the time, dismissed the Israeli account as "nonsense."

Israeli shells first hit the courtyard filled with refugees, then struck garages and the U.N.'s main warehouse, sending thousands of tons of food aid up in flames, Ging said. Later, fuel supplies went up in flames, sending a thick black plume of smoke into the air.

U.N. officials said the shells that hit the compound contained white phosphorus, which is believed to have been responsible for burns suffered by some Palestinian civilians during the war.

"It's a total disaster for us," Ging said, adding that the U.N. had warned the Israeli military that the compound was in peril from shelling that had begun overnight. U.N. officials say they have provided Israel with GPS coordinates of all U.N. installations in Gaza to prevent such attacks.

The refugees were moved to a school away from the immediate fighting, he said.

Separately, Israel shells landed next to a U.N. school in another Gaza City neighborhood, wounding 14 people who had sought sanctuary there, medics and firefighters said.

An Israeli attack near a U.N. school in northern Gaza earlier this month killed nearly 40 people. At the time, Israel said militants had fired on army positions from the beginning.

Barzak reported from Gaza City; Teibel from Jerusalem. Associated Press writers Karin Laub and Ian Deitch in Jerusalem, Sarah El Deeb in Cairo, and Mattew Lee in Washington contributed to this report.