"There was really an Israeli landing of troops around the Dar al-Hikma Hospital in Baalbek. Hezbollah fighters engaged Israeli troops in fierce fighting that has been raging on for more than an hour," Rahal told Associated Press at about 1 a.m.
Hezbollah's Al-Manar TV reported that fighters were involved in a "confrontation with an Israeli unit that landed near Al-Hikma Hospital west of Baalbek."
The Israeli army would not comment.
Witnesses said the hospital had been hit in an Israeli airstrike and was burning, but reports did not include that news.
Israeli warplanes had earlier attacked at least five suspected Hezbollah positions in that area three hours before the official end of a two-day pause in the air war.
Witnesses said fighter jets and helicopters never left Baalbek after that attack. The ancient city of Baalbek, a major Hezbollah stronghold, repeatedly has been pounded by Israeli fighter jets since the fighting began 21 days ago.
The strikes came late in a day rife with attacks on both sides of the Lebanon-Israel border, despite Israel saying it would halt airstrikes for 48 hours to allow aid convoys into battered southern Lebanon. It made the vow after a strike leveled a building and killed 56 Lebanese, mostly women and children.
Israeli warplanes pounded Hezbollah targets and ground fighting intensified in border towns, a day after Israel announced it would send thousands of troops deeper into Lebanon to secure the territory until a multinational force arrives.
The Israeli Defense Forces (IDF) warned Lebanese residents living in two villages north of the Litani river to leave the area, indicating strikes there were imminent, FOX News has learned. The IDF said it has information confirming that there is Hezbollah activity in the area. Pamphlets were distributed to residents warning of a possible attacks.
In announcing the expanded the operation, Israeli officials had said their soldiers were to go as far as the Litani, about 18 miles from the Israeli border.
Hezbollah had fired just 10 rockets across the border, well below an average of about 100 a day since the fighting began 21 days ago, Israel said.
The guerrilla group's television claimed that 35 Israeli soldiers had been killed or wounded in battles at the Lebanon-Israeli border town of Ainta al-Shaab, from which Hezbollah guerrillas crossed the border on July 12 and captured two Israeli soldiers. IDF confirmed only three deaths.
Three Lebanese civilians were killed and three more were seriously wounded when Israeli warplanes hit a house in the southern town of Lweizeh on Tuesday evening, Lebanese security officials said.
The Lebanese Red Cross said it retrieved 12 bodies buried in the rubble of four villages flattened by Israeli airstrikes in south Lebanon. It was unclear when they died. Workers were still digging through the wreckage, and said they expected to find more bodies.
Israeli Cabinet Minister Haim Ramon said the fighting to date had killed 300 of Hezbollah's main force of 2,000 fighters, which does not include its less-well trained reserves. "That's a very hard blow." he said.
Hezbollah has said that only 46 of its fighters were killed.
Four were lost in battles with Israeli ground troops in Adaisse and Taibeh, near the Christian town of Marjayoun, about 8 kilometers from the border with Israel, Hezbollah said.
Diplomatic Efforts Failing
Diplomatic efforts to end the crisis have faltered, despite increased world pressure for a cease-fire after the devastating weekend strike in the town of Qana. Israeli Prime Minister Ehud Olmert said the offensive would continue until Hezbollah has been neutralized. "We will not give up on our goal to live a life free of terror," Olmert said.
Britain, Germany and others watered down initial demands for an "immediate cease-fire," arguing such a move would do little to help deliver a lasting peaceful solution. "Cessation of hostilities is not the same as a cease-fire," said German Foreign Minister Frank-Walter Steinmeier. "A cease-fire can perhaps be achieved later. ... We can now only ask the U.N. Security Council and put pressure on it and not to waste any more time."
U.S. President George W. Bush also resisted calls for an immediate halt to fighting, saying any peace deal must ensure that Hezbollah is crippled. He said Iran and Syria must stop backing the Shiite militant group with money and weapons.
"As we work with friends and allies, it's important to remember this crisis began with Hezbollah's unprovoked attacks against Israel. Israel is exercising its right to defend itself," Bush said. (Full story )
Lebanon's president Emile Lahoud told FOX News he questioned Bush's plan to create a "new" Mideast.
"What is the 'new' Middle East? They mean by democracy, human rights? Is that what’s happening in Lebanon, in Palestine? There is something wrong," Lahoud told FOX News in an exclusive interview after meeting with Iran's Foreign Minister Manouchehr Mottaki in Beirut.
He also said Lebanon needs Hezbollah to protect the nation from Israel.
“You know what it means to finish with Hezbollah? It means Lebanon would go back to the past before the resistance, that Israel can go into Lebanon whenever it wants to, and no one will bother her,” Lahoud told FNC. Watch Lahoud on FOX News.
Iran Calls for Cease-Fire
Mottaki, visiting Beirut on Tuesday, blasted the U.N. Security Council for failing to stop the Israel-Hezbollah conflict and called the U.S. and Israel "partners in these brutal crimes" against Lebanese civilians.
His words echoed Iranian President Mahmoud Ahmadinejad, who said Tuesday that the U.S. and Britain were accomplices in the Israeli attacks against civilian targets in Lebanon.
"It has become clear that they (the U.S. and Britain) are not competent to sit on the U.N. Security Council and enjoy veto rights. They are culprits, criminals themselves. They must stand trial," he said in a speech to supporters in the city of Bojnoord, in northeastern Iran, broadcast live on state-run Iranian television. (Full story )
Aid Makes Its Way Into Lebanon
Aid groups struggling to get food and medicine to Lebanese villages ravaged by Israeli airstrikes described harrowing journeys south on Tuesday, caught off-guard by increased air raids during a supposed 48-hour lull.
The violence slowed relief efforts by the United Nations, which had hastily planned additional convoys to take advantage of Israel's pledge to pause its aerial bombardment. (Full story )
Israel Plans to Expand Offensive
The Israeli Security Cabinet made the decision to expand the ground offensive to carve out a Hezbollah-free zone up to the Litani river and hold it until a multinational force arrives. The Litani meanders through south Lebanon, and at some points is as far as 18 miles from the Israeli-Lebanese border.
Israel wants a strong, armed force with a mandate to confront militants, and Ramon reiterated Tuesday that Israel seeks NATO involvement. Israel feels U.N. peacekeepers, deployed in south Lebanon since 1978, are at best useless.
Up to now, several thousand soldiers had been engaged, fighting house-to-house battles with hundreds of Hezbollah fighters in Lebanese towns and villages close to the border. Last week, the Cabinet called up some 30,000 reserve soldiers, many of whom reported to their bases earlier this week to begin training.
Defense officials said they expected thousands more soldiers to be sent to Lebanon as part of the expanded offensive, which they said could last up to 10 days.
"We have reached the stage where we have to expand the operation," said Defense Minister Amir Peretz, without giving the dimensions of the next phase.
Peretz said Israel would target vehicles carrying weapons from Syria to Lebanon, but reiterated that Israel was not trying to draw Syria into the war. Israel has repeatedly accused Syria of allowing Iranian-made weapons to be shipped through its territory to Hezbollah guerrillas in Lebanon.
Syrian President Bashar Assad called on his army Monday to increase readiness to cope with "regional challenges." Travelers from Syria have reported that some reservists have been called up for military duty — a sign that Syria is concerned the fighting in Lebanon could spill over.
Hezbollah's allies Syria and Iran quietly entered the diplomacy. Egypt was pressing Syria not to try to stop an international force in the south, diplomats in Cairo said. Iran's foreign minister pulled into Beirut for talks with his French and Lebanese counterparts.
The Associated Press contributed to this report.