Israeli troops are moving towards the strategically significant Litani River, a spokeswoman said. Fresh air strikes inside Lebanon left several dead.
The UN passed a resolution urging a "full cessation of hostilities".
Israel's cabinet is to discuss the issue on Sunday and will only halt military action after it takes a vote.
Israeli Prime Minister Ehud Olmert is asking the cabinet to endorse the resolution, describing it as positive and acceptable.
But even as diplomats finalised the draft, Israel radio said troops had been ordered to seize ground as far as the Litani River, up to 30km (18 miles) from the Israeli border.
"We are expanding the combat areas to the Litani River and to areas from which (Hezbollah) rockets are fired on Israel in order to reduce and eventually stop these attacks," a senior commander in northern Israel, General Alon Friedman, was quoted as telling public radio.
Early on Saturday Hezbollah also fired a salvo of 20 rockets at Israel, AFP reported.
Big push?
Long columns of tanks and troops crossed the border under cover of darkness, reports from northern Israel said.
| This inability to act sooner has badly shaken the world's faith in this authority and its integrity Kofi Annan |
According to Lebanese security sources, at least five people were killed in Israeli air strikes in a village near Tyre.
Israeli jets also raided the city of Sidon - north of the Litani River - destroying facilities at a power station. It is only the second time Sidon has been hit in the conflict, which began more than four weeks ago.
However, Israeli officials gave no details as to the scale of the offensive and it is not clear whether this is the big push into Lebanon that Israel has been threatening.
The BBC's Bethany Bell in Jerusalem says there are some indications this could be sabre-rattling before Sunday's cabinet meeting.
Hezbollah factor
An adviser to Lebanese Prime Minister Fouad Siniora gave the resolution a cautious welcome, but there was no immediate reaction from Hezbollah.
| If the implementation takes place accurately and the Israelis stick to the resolution... I think Hezbollah will also accept it Eli Farzli Lebanese Information Minister |
Lebanese Information Minister Eli Farzli told the BBC Hezbollah would abide by the terms set out at the UN.
"If the implementation of the resolution takes place accurately, and the Israelis stick to the resolution, and if the Lebanese government accept it, then I think it means that Hezbollah will also accept it, and I think that Hezbollah will stick to the 1701 resolution," he said.
The Lebanese cabinet is also due to discuss the issue this weekend.
UN Security Council resolution 1701 was passed unanimously in New York after an impassioned speech from Secretary General Kofi Annan.
He lamented the UN's failure to act sooner to end fighting in the Middle East.
He also said the widely perceived delay in drafting a resolution had "badly shaken" global faith in the UN.
The new resolution says Hezbollah must end attacks on Israel while Israel must end "offensive military operations" in Lebanese territory.
Other key points include:
- Some 15,000 peacekeeping troops for the existing UN Interim Force in Lebanon, Unifil, which will receive a beefed-up mandate to monitor and enforce the ceasefire
- Lebanon's government asked to deploy troops to the south of the country, previously the domain of Hezbollah fighters
- Israel required to withdraw troops currently in southern Lebanon as UN and Lebanese forces are deployed
- Drawing up of plans for the disarmament of Hezbollah and the final settlement of the Israel-Lebanon border area, including the Shebaa farms area claimed by Hezbollah.
The US Secretary of State, Condoleezza Rice, said the deal should "open a path to lasting peace between Lebanon and Israel".
UK Prime Minister Tony Blair welcomed the resolution, but stressed that fighting should stop immediately following its adoption.
French Foreign Minister Philippe Douste-Blazy called the adoption of the resolution "a historic turning point".
But the foreign minister of Qatar, which currently sits on the Security Council, said the resolution still contained imbalances in favour of Israel.
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