The UN has abandoned its daily attempt to get an aid convoy through to south Lebanon, citing security fears.
Children were among the casualties of overnight strikes on Beirut
The decision comes a day after Israel imposed an open-ended curfew on all residents south of the Litani River.
Hezbollah has fired dozens of rockets into Israel, while one Israeli strike killed 13 villagers as mourners nearby buried their dead from earlier raids.
In New York, an Arab League delegation is due at the UN to seek amendments to a draft ceasefire resolution.
The delegation will press for the text to be changed to require an immediate Israeli withdrawal from Lebanon.
There is also dispute over the wording which currently demands that Hezbollah ends all attacks and Israel only ends "offensive" military operations.
A vote on the draft resolution is not expected until Wednesday.
Imposing its curfew south of the Litani river, Israel said any moving vehicles in the zone - up to 30km (18 miles) inside Lebanon's border - would be destroyed.
Leaflets dropped in Tyre, the biggest Lebanese city south of the Litani river, said operations against what they described as terrorist elements would be escalated with extreme force.
The BBC's Jeremy Bowen in Lebanon says Israel may be using threats to step up military action as a means of putting more pressure on the Lebanese government.
Roads and bridges linking Tyre and the outside world have been bombed, making it almost impossible to get aid in or civilians out.
The air strike which hit the southern village of Ghaziyeh during a funeral for earlier victims also left about two dozen people injured, local officials said.
Witnesses told the French news agench AFP that one of the destroyed homes belonged to a Hezbollah-linked cleric, but it was not clear if he was there at the time.
UN officials in Beirut decided not to even attempt sending a convoy to the south on Tuesday.
"We decided not to go today because of security concerns," Christiane Berthiaume of the UN's World Food Programme told the BBC News website.
"There has been so much bombing. There is no guarantee of safety. It is really very bad. It is getting worse.
"We have not been able to maintain a rhythm of two convoys per day, but even two would not be enough. A good number would be six."
Israeli Foreign Ministry spokesman Mark Regev told the BBC Israel was trying to co-ordinate aid efforts with the international community but could not assume every lorry was carrying aid rather than weapons.
In other developments:
- Lebanese police said at least 30 people were now known to have died in Israeli strikes on south Beirut on Monday night, Reuters news agency reported
- At least three Israeli soldiers died in clashes with Hezbollah in southern Lebanon on Tuesday, the Israeli military said
- Israel said it was temporarily moving all remaining residents from the city of Kiryat Shmona - hit by more Hezbollah missiles than any other town in Israel
- King Abdullah of Jordan, in a BBC interview, said the international community had shown only piecemeal ways of dealing with the Middle East and had no overall strategy
Lebanon has told army reservists to report for duty after the cabinet decided to send 15,000 soldiers to the southern border area once the Israelis pull out.
Israeli Prime Minister Ehud Olmert described the plan as an "interesting step" and said his government would study it.
Nearly 1,000 people, most of them civilians, have been killed in the conflict, the Lebanese government has said. More than 100 Israelis, most of them soldiers, have also been killed.