In overnight raids by Israeli forces, Lebanese officials say at least seven civilians were killed and several more injured.
Other attacks have continued into Sunday morning, hitting homes, bridges and petrol stations, as Israeli troops clashed with Hezbollah fighters near the port city of tyre.
The expanded Israeli ground assault involves as many as 30,000 troops dropped into southern Lebanon in what military officials say is Israel's largest ever air operation.
The Israeli raids were followed on Sunday morning by a series of rockets fired from Hezbollah positions into northern Israel. Local reports say at least one Israeli was killed and six injured.
The rocket attacks came as the Israeli cabinet met to give its approval to the ceasefire plan.
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On Saturday Kofi Annan, the United Nations secretary general, announced that the the prime ministers of Lebanon and Israel had agreed to a cessation of hostilities at 0500 GMT on Monday, August 14.
The agreement reached appears to offer hope of an end to a four-week old conflict that has killed over 1,000 Lebanese and more than 130 Israelis.
"I am very happy to announce that the two leaders have agreed that the cessation of hostilities and the end of the fighting will enter into force on 14 August, at 0500 hours GMT," Annan said in a statement.
"Preferably the fighting should stop now to respect the spirit and intent of the Council decision"
UN Secretary General
He urged both sides to halt the fighting immediately, and assured them that the United Nations force on the ground would work with them to monitor compliance of the Security Council resolution approved Friday to stop the hostilities.
The agreement paves the way for the UN to prepare for the deployment of up to 15,000 troops to help enforce the ceasefire.
'Pain and suffering'
"Preferably the fighting should stop now to respect the spirit and intent of the Council decision, the object of which was to save civilian lives, to spare the pain and suffering that the civilians on both sides are living through," Annan said.
Overnight on Saturday, at least seven civilians were killed and nine wounded as Israeli forces staged a series of attacks across Lebanon, officials said.
The dead included a mother, her three young children and their Sri Lankan maid, killed when Israeli bombs hit their home in the southern village of Burj el-Shemali.
Israel meanwhile said that 19 of its soldiers had died in fighting on Saturday - its heaviest losses in a single day since the start of the conflict.
Another five Israeli soldiers, missing after their helicopter was shot down, are also presumed to have died.
Bush speaks to leaders
Following the ceasefire agreement George Bush, the US president, spoke by telephone with the leaders of both Israel and Lebanon.
With the ceasefire imminent
Israel has stepped up raids
He spoke to Lebanese prime minister Fuad Siniora on Saturday, shortly after receiving a call from Israeli prime minister Ehud Olmert late Friday. It was Bush's first direct contact with either leader in several weeks.
The White House said Bush pressed Siniora on the importance to "dismantle Hezbollah's state within a state" after the unanimous UN resolution called for a 15,000-strong UN-approved force in the south of the country, to be positioned alongside a proposed Lebanese force of the same number.
Yet the resolution does not call for an immediate Israeli withdrawal - and the White House said Olmert in his call to the White House "thanked President Bush for the work he had done on the UN resolution on the Lebanon crisis."
Israel has said that it will continue its offensive against Hezbollah fighters in Lebanon until the ceasefire begin on Monday.
Earlier on Saturday, Hasan Nasrallah, head of Hezbollah, said that his organisation, which has two cabinet ministers, would abide by the UN-brokered truce.
"We will not be an obstacle to any [government] decision that it finds appropriate, but our ministers will express reservations about articles [in the UN resolution] that we consider unjust and unfair," he said in a speech broadcast on Hezbollah's Al-Manar television on Saturday.