The death toll has risen after Hamas fired rockets into Israel from Gaza in a surprise attack and Israel declared war.

According to Israeli officials, at least 40 people have died in Israel and more than 700 people have been injured. The Palestinian Health Ministry said 160 people were killed in Gaza and over a 1,000 others were injured.

According to Al Jazeera, Israeli forces have surrounded a house in the Israeli settlement of Ofakim and negotiations are underway with Palestinian fighters who are allegedly holding hostages. According to the Jerusalem Post, dozens of hostages are being by Hamas in the Kibbutz Be’eru in southern Israel.

President Joe Biden was briefed Saturday "on the appalling Hamas terrorist attacks in Israel," according to the White House.

"Senior national security officials briefed the President this morning on the appalling Hamas terrorist attacks in Israel. The President will continue to receive updates and White House officials remain in close contact with Israeli partners," the White House said in a statement.

-ABC News' Fritz Farrow

U.S. Defense Secretary Lloyd Austin released a statement saying he is "closely monitoring" the situation in Israel and extended his condolences to the families of those who have lost their lives.

"Over the coming days the Department of Defense will work to ensure that Israel has what it needs to defend itself and protect civilians from indiscriminate violence and terrorism," Austin said.

Separately, a U.S. defense official said that Austin had a call with his team Saturday morning, including U.S. Centcom Commander Gen. Eric Kurilla. Israel falls under Centcom’s area of responsibility.

-ABC News' Luis Martinez

Israeli Prime Minister Benjamin Netanyahu made a video statement on social media, saying simply, “We are at war. We will win," in his first comments, made in Hebrew, after the attack.

"Citizens of Israel, we are at war, not in an operation or in rounds, but at war. This morning, Hamas launched a murderous surprise attack against the State of Israel and its citizens. We have been in this since the early morning hours. I convened the heads of the security establishment and ordered – first of all – to clear out the communities that have been infiltrated by terrorists," Netanyahu said. "This currently is being carried out. At the same time, I have ordered an extensive mobilization of reserves and that we return fire of a magnitude that the enemy has not known. The enemy will pay an unprecedented price. In the meantime, I call on the citizens of Israel to strictly adhere to the directives of the IDF and Home Front Command. We are at war and we will win it."

Hamas fighters are believed to be "still hiding" in some communities in southern Israel even after the Israeli military took back control, according to Israel Defense Forces spokesman Maj. Doron Spielman.

"We are in control of the communities, but we actually assume that there are Hamas terrorists that are still hiding in these areas, including in the road where we are now," Spielman told ABC News during an interview Monday in Sderot, Israel. "In all these communities, we've seen terrorist come out of hiding. Just yesterday, they took over an ambulance."

"We're still being very, very careful," he added. "This is a war zone with active terrorists that are operating here."

Sderot is a southwestern Israeli city located near the county's border with the Hamas-ruled Gaza Strip. A police station there was stormed by Hamas fighters on Saturday as part of the militant group's wider incursion, leaving at least six Israeli police officers dead. The IDF then bombed the police station with the Hamas fighters inside, demolishing it.

Hamas fighters and other Palestinian militants are "striking strategic locations" along the border fence, allowing them to drive through in pickup trucks, Spielman said. Civilians in some of the local communities have been ordered to evacuate, while others have left voluntarily, according to Spielman.

"We do have a lot of ground troops in this area. We have a lot of tanks. We have, in addition, artillery. And we're prepared forever for anything," he said. "And if it happens, the next stage, it's going to happen here because this is the area that was the flashpoint and this is the area we're going to be presenting ourselves and finishing this battle. We, of course, have no choice but to finish."

When asked about the mounting casualties of Palestinian civilians in Gaza as a result of the IDF's retaliatory airstrikes, Spielman said: "We always try to avoid civilian casualties. However, I would say that this is war and our first priority here is to destroy Hamas."

-ABC News' Angus Hines and Ian Pannell