Israeli Prime Minister Benjamin Netanyahu has told US President Joe Biden he is sending a delegation to resume stalled negotiations on a hostage release deal with Hamas.
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A source in the Israeli negotiating team said there was a real chance of achieving agreement after Hamas made a revised proposal on the terms of a deal.
"The proposal put forward by Hamas includes a very significant breakthrough," the source said, speaking on condition of anonymity.
The Israeli response to the Hamas proposal, submitted via mediators, was in marked contrast to past instances during the nearly nine-month war in Gaza, where Israel has said the conditions attached by Hamas were not acceptable.
An Israeli official said the head of Israel's Mossad intelligence agency would lead the Israeli delegation for the talks.
The White House said Biden and Netanyahu, on a phone call, discussed the response received from Hamas on possible terms of a deal.
"The president welcomed the prime minister's decision to authorise his negotiators to engage with US, Qatari, and Egyptian mediators in an effort to close out the deal," it said in a statement.
In the phone call, Netanyahu repeated his position that Israel would only end its war in Gaza when all its objectives had been achieved, his office said in a statement.
The source in the Israeli negotiating team said: "There's a deal with a real chance of implementation."
The source cautioned, though, there was a risk a deal could be scuppered by "political considerations".
Some far-right partners in Netanyahu's ruling coalition have indicated they may quit the government if the war ends before Hamas is destroyed. Their departure from the coalition would likely end Netanyahu's premiership.
Israel received Hamas' response on Wednesday to a proposal made public at the end of May by Biden that would include the release of about 120 hostages held in Gaza and a ceasefire in the Palestinian enclave.
Hamas has said any deal must end the war and bring a full Israeli withdrawal from Gaza. Israel maintains it will accept only temporary pauses in the fighting until Hamas is eradicated.
The plan entails the gradual release of Israeli hostages still being held in Gaza and the pullback of Israeli forces over the first two phases, and the freeing of Palestinian prisoners. The third phase involves the reconstruction of the war-shattered territory and return of the remains of deceased hostages.
It was not clear where the Israeli delegation would go to resume the talks. Prior efforts to end the Gaza conflict were mediated by Egypt and Qatar, with talks held in both locations.
On Thursday, Gaza's health ministry said the Palestinian death toll in the nearly nine months of war had passed 38,000, with 87,445 wounded. The health ministry does not distinguish between civilians and fighters in its figures.
The war in Gaza began when Hamas-led gunmen burst into southern Israel on October 7, killed 1,200 people and took around 250 hostages back into Gaza, according to Israeli tallies.
In Gaza, Palestinians reacted cautiously to the prospect of renewed talks, as the conflict continued.
An Israeli strike hit a school in Gaza City and the Civil Emergency Service said five Palestinians were killed and others wounded, while other Israeli strikes on Gaza City's old town on Thursday killed a woman and wounded several others, medics said.
The Israeli military said it had been operating to dismantle Hamas' military and administrative capabilities. It said it was acting in accordance with international law and taking feasible precautions to minimise civilian casualties.
Australian Associated Press
