UN Secretary General Kofi Annan has expressed deep concern over Saturday's Israeli commando raid deep inside Lebanon, calling it a truce violation.
This crater in Bodai is said to have been caused by an Israeli air strike
Lebanon has said it may halt its army deployment in the south - a key element of the ceasefire plan.
The Bekaa Valley raid early on Saturday left one Israeli dead. Hezbollah denies reports it lost three militants.
Israel said it was trying to disrupt weapons supplies from Iran and Syria to Hezbollah, and insisted the truce held.
Israeli Prime Minister Ehud Olmert is reported to have defended the raid during a telephone conversation with Mr Annan.
He is facing growing criticism in Israel for not having achieved one of his key objectives at the beginning of the conflict - the disarmament of Hezbollah, the BBC's Bethany Bell reports from Jerusalem.
An Israeli commission of inquiry into the way the military campaign in Lebanon was handled begins its work on Sunday.
Meanwhile, Lebanon's defence minister Elias Murr has said anyone violating the United Nations-brokered ceasefire will be considered a traitor and be dealt with decisively.
He said any rocket fired from Lebanese territory would be considered collaboration with Israel to provide a pretext for it to strike.
Saturday's raid centred on the village of Bodai, west of the city of Baalbek, some 100km (60 miles) north of the Israeli border.
It was the most serious incident since the UN-brokered truce came into effect on Monday.
"The secretary general is deeply concerned about a violation by the Israeli side of the cessation of hostilities," a spokesman for Mr Annan said on the UN website.
Such violations "endanger the fragile calm", the statement said.
It also called on "all parties to respect strictly the arms embargo".
Threat to ceasefire
Lebanon's Prime Minister, Fouad Siniora, called the raid a "naked violation" of the six-day-old UN truce.
The French troops' rules of engagement are not clearly defined
His Defence Minister, Elias al-Murr, said that if the UN failed to give "clear answers" in response to the raid he "might be forced to ask the cabinet early next week to halt the army deployment in the south".
The BBC's Nick Childs in Beirut correspondent says the UN's main concern is that the incident both highlights the urgent need for UN reinforcements and will put off potential troop contributors, because it projects an image of insecurity.
Fifty French military engineers arrived in the Lebanese port of Naqoura on Saturday, the first soldiers to bolster the UN peacekeeping force.
They are among 200 extra troops promised by France, as the UN struggles to build its expanded force.
The UN wants 3,500 troops on the ground by the end of August, to be increased later to 15,000. It says it is disappointed with the French contribution and wants other European nations to offer more help too.
Lebanon will be the focus of emergency talks between Arab foreign ministers in Cairo on Sunday. Syrian Foreign Minister Walid al-Muallim will not attend, Dubai-based Al-Arabiya TV reported.
Blood and bandages at the scene of the Israeli raid were evidence of the haste with which the Israelis had to treat their wounded, the BBC's Jon Leyne reports.
Local people said the Israelis came down from the hills in two jeeps and drove across a cornfield.
The troops then battled Hezbollah forces for more than two hours before being flown out by helicopter while fighter jets provided cover, the villagers said.
There is speculation locally that the Israelis may have been trying to capture a senior Hezbollah figure who lives in the village.
One Israeli officer was killed and two other officers were wounded in what unnamed Israeli military sources quoted by Haaretz newspaper said was a fierce battle:
"We had great luck that the operation didn't result in 10 fatalities from the force."
Lebanese sources earlier told Reuters agency that three militants had died in the incident but Hezbollah has denied the reports.
Israel insisted it had not breached the ceasefire.
"We had specific information of arms transfers taking place and we acted to prevent that violation, so that violation is not from the Israeli side - we were responding to a violation of the resolution by Hezbollah," said Israeli spokesman Mark Regev.
Israel has said it will continue to carry out such actions until an expanded international military force is in place to prevent Hezbollah's rearmament.
The UN resolution which stopped the conflict said Israel should end all offensive military action and Hezbollah should end all attacks.
It also called for a halt to all unauthorised arms deliveries to Lebanon.