Although Lebanon has paid the price with mounting civilian casualties and a devastated infrastructure, Hezbollah has largely remained intact, and despite the 12-day pounding of the militia's positions it is still able to fire rockets into Israel.
The Israeli military, which prides itself on a history of brilliant victories over the Arabs, was caught unawares when Hezbollah captured two Israeli soldiers and killed four sailors in an attack on an Israeli navy boat.
An Iranian-made radar-guided anti-ship missile was used in the attack, the Israeli military has said, and Tel Aviv is admitting that it was caught off-guard, a second time.
"We were not aware that Hezbollah possessed this kind of missile," Rear Admiral Noam Faig, Israel Navy (IN) head of operations, told Jane's Defence Weekly last week. "We are familiar with that missile from other areas, but assumed that the threat was not present in Lebanon."
Prepared for showdown
In relative terms, the militia has had more success in fighting Israel than many Arab states and analysts say the group was well prepared for the showdown.
The militia has been building
sophisticated armoury since 2000
Amal Saad-Ghoreyeb, author of "Hezbollah: Politics and Religion" told Aljazeera.net: "A lot of commentators say the group must have miscalculated. But Hezbollah’s ability to provide a military deterrent must be indicative of the fact that the movement was prepared for such an Israeli onslaught."
Twenty Israeli soldiers have been killed and several tanks destroyed by Hezbollah, who has confirmed that 13 of its fighters have also been killed.
Israel says Hezbollah’s losses are as high as 100.
Hezbollah’s tactics are becoming clearer as the conflict continues. The group has a military force as large as 5000 that is divided into decentralised divisions, and since the Israeli withdrawal from the south in 2000, the group has been preparing underground tunnels across south Lebanon and building sophisticated armoury.
Vietnam style warfare
Military analysts have drawn comparisons between the Hezbollah and Vietnamese fighters and other guerrilla forces in their tactics.
Hezbollah has years of experience
in guerilla warfare
"They are well armed, well motivated combat veterans from the 1990s. It's the old Mao Tsetung guerrilla strategy of retreating when the enemy advances and advancing when the enemy retreats," Nicholas Blandford, the Jane's Defence Weekly analyst in Lebanon, told Aljazeera.net.
Unlike many Arab militaries that are under tight, centralised control, Hezbollah works in small decentralised groups that are able to respond quickly without permission from senior ranks.
"They always operate in small isolated cells. One cell does not know what the other cell is doing. I am sure Hassan Nasrallah does not know what the military wing is doing sometimes. This decentralised structure is part of the group's military potency," Saad-Ghoreyeb said.
The last war Israel fought in Lebanon was against the Palestinian Liberation Organisation in 1982; but the Palestinian resistance to the Israeli invasion was mostly unsuccessful as it was infiltrated with informers and applied tactics similar to a regular army.
This time Israel faces a far more formidable force made up of dedicated and secretive members who have years of experience in fighting a guerrilla war in south Lebanon.
Reports from Israeli soldiers returning from raids in Lebanon say that they have fought fierce battles with a formidable foe.
Israeli soldiers admit that they are
fighting a formidable foe
"They're not normal soldiers, you know," one was quoted by the Associated Press as saying. "They're guerrillas. They're very smart."
But although Hezbollah have fared well up until now, it remains to be seen how long they can sustain the fierce Israeli assault.
Supply lines within Lebanon have been cut and the group will also have difficulties importing weapons from outside the country. However, according to Israeli reports they have enough rockets to last them for a month.
"The rate of rocket fire has dwindled since last Wednesday. Whether this is a tactical move or because they are running low on supplies is impossible to say," Blanford said.
What is likely is that Hezbollah are waiting for a full-scale invasion so they can engage Israel on the ground and fight a guerrilla war in the wadis and mountains of south Lebanon.
"As for us, our equation and principles are the following: When the Israelis enter, they must pay dearly in terms of their tanks, officers, soldiers. This is what we pledge to do and we will honour our pledge, God willing"
Hassan Nasarallah, Hezbolla's secretary general
"As for us, our equation and principles are the following: When the Israelis enter, they must pay dearly in terms of their tanks, officers, soldiers. This is what we pledge to do and we will honour our pledge, God willing," Hassan Nasrallah, Hezbollah secretary general, said in an interview with Aljazeera on Thursday.
Tel Aviv ended its 18-year-long occupation of the border area in 2000 and is unlikely to re-engage in a conflict that was sometimes referred to as "Israel's Vietnam".
Alon Ben-David, a Jane's Defence Weekly correspondent wrote in last week’s issue that the Israeli military has suffered “considerable” casualties in its push north in Lebanon.
"The Israeli forces have discovered that Hezbollah has established a Viet Cong-style network of tunnels and trenches close to the Israeli border, providing shelter for its operatives and their weapons," he said.