Earlier on Wednesday, before the rocket fire, a Hamas official said these negotiations were in "advanced stages".
The source, speaking on condition of anonymity, said that as part of the deal, which was brokered by Egypt and the United Nations with input from Turkey and Qatar, Hamas and Israel would initially observe a two-week trial cease-fire.
An Israeli policeman surveys the scene where a rocket exploded in the southern city of Sderot, Israel August 8, 2018.
However, fighting between Israel and Hamas continue despite the ceasefire talks.
Smoke plumes could be seen rising from Gaza City following the Israeli raids on Wednesday night.
Israeli tank fire killed two Hamas gunmen in Gaza on Tuesday in a strike the Israeli military described as return fire for a shooting attack against its forces, an account disputed by the Palestinian Islamist group.
"I am deeply alarmed by the recent escalation of violence between Gaza and Israel, and particularly by today's multiple rockets fired towards communities in southern Israel", said U.N. Middle East envoy Nickolay Mladenov.
The strikes come in retaliation for a six-hour barrage of rockets which forced thousands of Israelis to seek shelter along Gaza border towns.
Israel halted the supply of petroleum and natural gas to Gaza last week in response to incendiary kites and balloons launched from Gaza into southern Israel.
"The Hamas terrorist organization is responsible for everything in and out of the Gaza Strip and will bear the consequences for the acts of terror perpetrated against Israeli civilians", the IDF said.
According to the IDF, the rockets were launched from the Hamas-run enclave and two were intercepted by the Iron Dome missile defence system.
Hamas warned Israel - with which it has fought three wars since 2008 - it would pay for the attack. The IDF later suggested the incident was a misunderstanding, as the tank returned fire in response to the shots fired as part of a ceremony of the al-Qassam Brigades, which were not deliberately aimed at Israeli soldiers, Haaretz reported.
The plan includes "the establishment of an airport, a port and a railway to link the Gaza Strip with the West Bank", the media said.
Later, Palestinians fired about 70 rockets across the border, and Israeli aircraft struck at least a dozen militant targets.