The cease-fire announcement had set off frenzied late night street celebrations in the coastal strip, and raised hopes of a new era in relations between Israel and Hamas. The two sides are now to negotiate a deal that would open the borders of the blockaded Palestinian territory.
However, the vague language in the agreement and deep hostility between the combatants made it far from certain that the bloodshed would end.
Israel launched the offensive on Nov. 14 to halt renewed rocket fire from Gaza, unleashing some 1,500 airstrikes on Hamas-linked targets, while Hamas and other Gaza militant groups showered Israel with hundreds of rockets.
It was the worst fighting since an Israeli invasion of Gaza four years ago.
The eight days of relentless strikes killed 161 Palestinians, including 71 civilians, and five Israelis. Israel also destroyed key symbols of Hamas power, such as the prime minister's office, along with rocket launching sites and Gaza police stations.
Despite the high human cost, Hamas claimed victory Thursday.
"The masses that took to the streets last night to celebrate sent a message to all the world that Gaza can't be defeated," said a spokesman, Sami Abu Zuhri.
While it is far from certain that Hamas will be able to pry open Gaza's borders in upcoming talks, the latest round of fighting has brought the Islamists unprecedented political recognition in the region. During the past week, Gaza became a magnet for visiting foreign ministers from Turkey and several Arab states _ a sharp contrast to Hamas' isolation in the past.
Israel and the United States, even while formally sticking to a policy of shunning Hamas, also acknowledged the terrorist group's central role by engaging in indirect negotiations with the Islamists. Israel and the West consider Hamas, which seized Gaza by force in 2007, to be a terrorist organization.
Israeli Defense Minister Ehud Barak, meanwhile, defended his decision not to launch a ground offensive, in contrast to Israel's invasion of Gaza in the winter of 2008-2009.
"You don't get into military adventures on a whim, and certainly not based on the mood of the public, which can turn the first time an armored personnel carrier rolls over or an explosive device is detonated against forces on the ground," he told Israel Army Radio.
"The world's mood also can turn," he said, referring to warnings by the U.S. and Israel's other Western allies of the high cost of a ground offensive.
However, with the cease-fire just a few hours old, Israel was not rushing to bring home all of the thousands of reservists it had ordered to the Gaza border in the event of a ground invasion, Barak said.
Barak was defense minister during Israel's previous major military campaign against Hamas, which drew widespread international criticism and claims of war crimes.
The mood in Israel was mixed, with some grateful that quiet had been restored without a ground operation that could have cost the lives of soldiers.
Others _ particular those in southern Israel who have endured 13 years of rocket fire _ thought the operation was abandoned too quickly and without guaranteeing their security.