GAZA CITY, Palestinian Territories (AFP) - Thousands of Palestinians were fleeing northern Gaza on Sunday after a night of intense Israeli strikes and an explicit warning from the army that the raids were set to intensify.

Israeli strikes on Gaza killed a teenage boy and a woman on Sunday, medics said, raising the overall death toll to 165 as the punishing air campaign entered its sixth day.

In Beit Lahiya, whole streets were emptying, with residents fleeing with all the belongings they could carry - by car, by donkey- and horse-drawn carts, and on foot.

"Last night there was so much shelling that no one could sleep, it was terrifying," said one man, who gave his name only as Farid.

He was fleeing with six family members, riding alongside them on a motorbike piled high with blankets.

"I'm going to try to go to a school, anywhere that is safe," he told AFP.

Mohammed Sultan packed his family's belongings onto a horse-drawn cart, with five children sitting among the hastily assembled items.

He walked alongside the cart, with other adult relatives, heading for a school run by the United Nations Relief and Works Agency for Palestine refugees (UNRWA).

Earlier on Sunday, the Israeli army said it would drop leaflets over the north warning residents to leave their homes "immediately" ahead of a fresh wave of attacks it said would begin at midday (0900 GMT; 5pm Singapore time).

It even specified the areas that it would hit most heavily.

"This is a real threat, it's not a psychological threat," military spokesman General Moti Almoz told army radio.

"We are asking the Palestinian population to leave the place because they could really get hurt." But Sultan said he had not received any warning.

"We didn't get any warning, but there was firing all around us all night," he told AFP.

"We were terrified and so afraid for our children," he said. "It was total war." Overnight, the Palestinian death toll from five days of an intensive Israeli air campaign rose to 165, among them a large number of civilians.

- Barefoot and terrified -

During the night, Samari al-Atar, who lives in the Atatra neighbourhood - one of the areas Israel said it would hit hard - fled to an UNRWA school in Gaza City.

"We tried to shelter inside the house but we heard the sounds of people screaming and when we looked outside there were many people fleeing their homes," she said.

"It was the middle of the night, and I gathered the children, they were so afraid," she added, her voice breaking as she started to cry.

"Even as we were fleeing, there was firing all around us... we couldn't take anything with us, the children were barefoot." Inside the school compound, the displaced children draw on a blackboard, sketching images of war in pink and yellow chalk - Israeli helicopters and tanks firing, and Palestinian rockets.

One boy seemed almost catatonic as he spoke in a long, monotone about fleeing his home, his eyes downcast and fixed on the floor.

Maani al-Ataar described the terror of fleeing by night, as Israeli planes circled overhead.

"People were screaming and there were old men who couldn't walk properly, the younger men had to support them," she said.

"There was no electricity, so the road was pitch black." Robert Turner, director of UNRWA operations said thousands of displaced people were already sheltering in its schools across Gaza.

"UNRWA now has eight schools sheltering about 4,000 displaced Gazans. More are arriving by the minute. They are mostly fleeing areas in the north, Beit Lahiya and Beit Hanun," he told reporters.

In Beit Lahiya, Farida Zayed was packing up her belongings and preparing to flee, without knowing where she would go.

"People say they are going to the schools, but Israel has bombed schools before. Even the hospitals have been bombed," she said.

"We've lost everything, our future and the future of our children," she said.

"The Israelis don't want to let us live."