The Israeli cabinet has agreed to widen the country's ground offensive against Hezbollah in southern Lebanon.
Some 15,000 reservists could be called up for the wider offensive
The decision, made at a closed-door session, received unanimous approval, a senior political source said.
In the latest fighting, Israeli war planes struck eastern Lebanon, Lebanese officials said.
Earlier Prime Minister Ehud Olmert ruled out an immediate truce, saying Israel would continue its offensive as long as its security was threatened.
Mr Olmert also reiterated calls for the release of the two Israeli soldiers seized by Hezbollah - whose capture in a cross-border raid sparked the conflict on 12 July.
Speaking in Tel Aviv he said the offensive would end "when the threat over our heads is removed (and) when our kidnapped soldiers return to their homes".
Widening the ground offensive could take Israeli soldiers deeper into southern Lebanon, says the BBC's Katya Adler in Jerusalem.
Israel has been attempting to establish what it calls a "security zone" there, to push Hezbollah back from the border.
Israeli radio also reported that the government was planning to call up thousands more reservists.
On Tuesday Lebanese security officials said Israeli planes had launched fresh strikes, targeting the road linking north east Lebanon and Syria.
A village considered to be a Hezbollah stronghold, 15km (9 miles) from the border, was hit several times, police said on Tuesday.
Syrian President Bashar Assad told his troops to increase their state of readiness to face "regional challenges".
The UN says aid is not getting through to where it is needed
In a written message on the eve of Syria's annual army day on Tuesday, Mr Assad called on soldiers to intensify their training.
Israeli troops were also said to be engaged in heavy fighting with Hezbollah fighters in border areas in southern Lebanon, according to Reuters news agency.
On Monday, Israel had agreed to a 48-hour suspension of air strikes to allow an investigation into air strikes on the village of Qana in which some 54 civilians died.
But less than a day after the agreement, Israeli planes bombed parts of southern Lebanon.
Israel said it had been responding to attacks by Hezbollah.
The United Nations meanwhile said there had been no improvement in access for aid agencies to southern Lebanon since the Israeli suspension of air strikes.
Aid agencies said they were having to ask Israel for safe passage for each aid convoy three days in advance and had not received enough notice to take advantage of the suspension.
Two convoys reached the Lebanese port of Tyre on Monday after a long detour through the mountains because of bomb damage to the main coast road.
After nearly three weeks of fighting, about 750 people - mainly civilians - have been killed by Israeli action, according to Lebanon's health minister.
A total of 51 Israelis, including at least 18 civilians, have been killed by Hezbollah - which has been fighting Israeli incursions and sending rockets into northern Israel.
Further diplomatic moves were made on Monday with the French and Iranian foreign ministers meeting in Beirut as part of continuing efforts to resolve the crisis.
Neither minister commented after the meeting, but earlier French Foreign Minister Philippe Douste-Blazy said it was vital to include Iran - which backs Hezbollah - in the process.
On Tuesday, European Union foreign ministers will meet in Brussels for emergency talks on the crisis.