Four United Nations observers have been killed in an Israeli air strike on an observation post in south Lebanon.
Israel had hit Khiam a number of times earlier on Tuesday
UN Secretary General Kofi Annan said he was "shocked" at the "apparently deliberate targeting" of the post. Israel has expressed "deep regret".
Israel earlier said it would control an area in southern Lebanon until international forces deployed.
The force will be discussed at international crisis talks to be held in Rome on Wednesday.
The meeting is being attended by US Secretary of State Condoleezza Rice and Mr Annan, as well as foreign ministers and top officials from five European and four Arab countries.
BBC diplomatic correspondent Bridget Kendall said the Italian prime minister and others believe a quick ceasefire to be the main priority.
But the US and Britain will not push for a ceasefire unless root causes of the conflict are addressed, she adds.
The summit will take place without a delegation from Israel.
Ms Rice will attend the talks after ending her tour of the Middle East on Tuesday.
More than 380 Lebanese and 42 Israelis have died in nearly two weeks of conflict in Lebanon, which began after Hezbollah captured two Israeli soldiers in a cross-border raid on 12 July.
The UN in Lebanon says the Israeli air force destroyed the post, in which four military observers were sheltering.
It said the four, from Austria, Canada, China and Finland, had taken shelter in a bunker under the post after it was earlier shelled 14 times by Israeli artillery.
A rescue team was also shelled as it tried to clear the rubble.
"I am shocked and deeply distressed by the apparently deliberate targeting by Israeli Defence Forces of a UN Observer post in southern Lebanon," Mr Annan said in a statement from Rome.
Unifil has been operational in the border area since 1978 and is currently 2,000 strong.
Hezbollah's leader, Hassan Nasrallah, has vowed the group will continue its rocket attacks on Israel.
Mr Nasrallah told Hezbollah's al-Manar television that the militant group would fire rockets deeper into Israel and would counter any Israeli advance into southern Lebanon, and criticised what he called an Israeli-US plan for a "new Middle East".
"There is no way that we can accept any humiliating conditions on us, our people or our country... especially after all these sacrifices... we are open to political discussions and solutions with flexibility, but the dignity and national interest is a red line."
In other military action:
- The Israeli army said it had killed a senior Hezbollah commander, Abu Jaafar, in fighting in southern Lebanon
- Earlier the UN said Israeli forces were now in control of the town of Bint Jbeil after fierce fighting and were moving on the village of Yaroun to the south
- Israel resumed air raids on Beirut, with explosions heard in southern suburbs - a Hezbollah stronghold
- Hezbollah fired more Katyusha rockets into Israel, killing a 15-year-old Arab-Israeli girl in the northern Israeli village of Maghar and striking Haifa with a large salvo
- Hezbollah said 27 of its fighters had been killed as of Monday, but the Israeli military said it had killed "some dozens".
Earlier, Israeli Defence Minister Amir Peretz had said a "security zone" in southern Lebanon would be maintained "under the control of our forces if there is not a multinational force".
Hezbollah has maintained its rocket fire into Haifa
He said: "We have no other option. We have to build a new security strip that will be a cover for our forces."
He did not specify whether Israeli troops would remain there but insisted they would "continue to control [Hezbollah]" in their operations.
Israeli government sources have estimated the width of the zone at anything from three to 10km (1.9-6.2 miles).
An unnamed Israeli official quoted by Reuters news agency said between 10,000 and 20,000 international peacekeepers would be needed.
BBC defence and security correspondent Rob Watson says Israeli details on the zone - and how it will be secured - are far from clear.
He says it is possible Mr Peretz is trying to put pressure on the international community to deliver the peacekeeping force.
Earlier, Ms Rice met Israeli PM Ehud Olmert and later Palestinian President Mahmoud Abbas.
Mr Abbas called for an immediate end to "aggression against the Gaza Strip and the West Bank" and for an "immediate ceasefire" in Lebanon.
Ms Rice said the only solution was a sustainable and enduring peace.
Her words were reinforced later by US President George W Bush who said: "I support a sustainable ceasefire that will bring about an end to violence... Our mission and our goal is to have a lasting peace, not a temporary peace."
In his meeting with Ms Rice, Mr Olmert said he was "very conscious" of the humanitarian needs of Lebanon's civilians, but insisted Israel was defending itself against terrorism.