The Israeli military said its warplanes were attacking Hezbollah targets in Lebanon after detecting attempts to fire missiles and rockets into Israel.
“In order to neutralize these threats, the IDF is striking terrorist targets,” IDF spokesman Daniel Hagari said.
Israel says Lebanese civilians have been warned to immediately leave areas where the Iran-backed Shiite Muslim group Hezbollah operates.
Soon after, Hezbollah said it had launched a massive drone strike against Israel in response to the killing of the group’s top military commander last month.
Early on Sunday, sirens of rocket attacks rang across northern Israel.
There have been no reports of any injuries.
The Israel Defense Forces said in a statement that Hezbollah “has just fired more than 150 artillery shells from Lebanon into Israeli territory.”
Mr Hagari later said that “dozens of Israeli Air Force jets are currently attacking targets in various locations in southern Lebanon”.
At the same time, Hezbollah said it had fired more than 320 Katyusha rockets, hitting 11 Israeli military bases and barracks.
Israeli Prime Minister Benjamin Netanyahu said he was convening an emergency meeting of his security cabinet.
Mr Netanyahu’s office said the prime minister and Defense Minister Yov Galante were “controlling the situation” at an IDF military base in Tel Aviv.
Meanwhile, Hezbollah said in a statement that the attack on Israel was in response to “the brutal Zionist aggression that resulted in… the martyrdom of Fouad Shukr.”
Top Shia military commander killed in Israeli airstrike July in Beirut, the capital of Lebanon.
Israel has been at war with the Lebanese armed group since the war with Hamas in the Gaza Strip broke out last October.
Hamas, like Hezbollah, is backed by Iran.