Jerusalem ? Israel bombed and shelled southern Lebanon and sent ground troops over the border for the first time in six years Wednesday after Hezbollah guerrillas captured two Israeli soldiers. The fighting killed eight Israeli soldiers and three Lebanese.

Hezbollah’s brazen cross-border raid opened a second front for the Israeli army. The army is now fighting Islamic militants in both Lebanon and the Gaza Strip, where it is looking for another soldier who was captured more than two weeks ago by Hamas-linked militants.

Israeli Prime Minister Ehud Olmert called the Hezbollah raid an “act of war” by Lebanon and threatened “very, very, very painful” retaliation.

The Cabinet, meeting in the wake of the military’s highest daily death toll in four years, decided to continue the army operation and call on the international community to disarm Hezbollah, according to participants.

Residents of northern Israeli towns were ordered to seek cover in underground bomb shelters as Hezbollah, an anti-Israel guerrilla group that essentially runs southern Lebanon, launched rockets across the border throughout the day.

Two Lebanese civilians and a Hezbollah fighter also were killed in the border violence. Still, jubilant Hezbollah supporters and Palestinians in Lebanon fired guns in the air and set off firecrackers at the news of the soldiers’ capture.

An Israeli artillery unit fires across the border into southern Lebanon from a position on the frontier in Zaura, northern Israel. Hezbollah fighters launched a raid into Israel and captured two Israeli soldiers Wednesday, triggering an Israeli assault with warplanes, gunboats and ground troops in southern Lebanon to hunt for the captives.

Hezbollah leader Sheik Hassan Nasrallah said he would free the Israeli soldiers only in a prisoner swap, adding that he was open to a package deal that would include the release of the soldier held in Gaza.

“The capture of the two soldiers could provide a solution to the Gaza crisis,” he told reporters in Beirut.

At least 23 Palestinians were killed in Gaza on Wednesday. And an Israeli airstrike early today destroyed the building housing the Hamas-controlled Palestinian Foreign Ministry. Palestinian medics said 13 people in the neighborhood, including six children, were injured, mainly from flying glass and debris.

That crisis began June 25 when Palestinian militants dug a tunnel out of the Gaza Strip and attacked an army position inside Israel, seizing Cpl. Gilad Shalit and demanding the release of 1,500 prisoners held by Israel.

Although Israel has made prisoner exchanges in the past, Olmert ruled out any negotiations for Shalit’s return, saying that would only encourage more kidnappings.

Instead, Israel unleashed an offensive against Gaza, sending in troops, firing artillery and carrying out airstrikes on militant targets in an effort to force the Palestinians to free Shalit.

In an attempt to assassinate top Hamas fugitives Wednesday, Israel dropped a quarter-ton bomb on a home in Gaza City, killing a couple and seven of their children, ages 4-18. Hamas said its leaders escaped harm, but militants took over the intensive care unit of a hospital, barring reporters.

Palestinian security officials said Mohammed Deif, leader of Hamas’ military wing and No. 1 on Israel’s wanted list for more than a decade, was among the wounded – suffering severe back injuries that could paralyze him. At least 14 other Palestinians were killed in separate Israeli attacks Wednesday.

Palestinians in Gaza welcomed the attack in Lebanon, hoping it would force Israel to shift its focus away from them.

“People are cheering this attack … because they view it as a kind of revenge and reprisal against what Israel has been doing in Gaza,” said Salah Bardawil, a spokesman for Hamas in the Palestinian parliament. “Militarily, by opening a new front against Israel, it would ease the pressure on us. Israel is using a huge force in Gaza now. It will have to use part of its military capacity in Lebanon.”