"Israel has agreed to extend a three-day ceasefire in Gaza beyond Friday," BBC quoted Israeli officials as saying.
The officials, however, did not say how long the ceasefire would last.
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The 72-hour ceasefire, which came into effect yesterday, has brought relief to millions on both sides after one month of fighting killed nearly 1,900 Palestinians and 67 people in Israel, mostly soldiers.
Tens of thousands of Gaza residents who were displaced due to heavy shelling from Israel, began returning back from the UN shelters, only to find their homes and businesses in ruins.
United Nations chief Ban Ki-moon on Wednesday urged a permanent end to the cycle of Israeli and Palestinian violence.
Indirect talks between Palestinian factions and Israel have been taking place, mediated by Egypt, to broker a lonG-term ceasefire.
Israel wants Hamas, the militant Islamic group that runs Gaza, to disarm. Hamas, meanwhile, wants an end to the Israeli blockade of Gaza, a measure Israel says is necessary to stop weapons being smuggled in.
The latest Gaza conflict is the third in less than six years. Previous cease-fires have brought calm for a matter of months or years, but failed to tackle the broader issues.
Israel launched Operation Protective Edge on July 8 with the stated aim of ending rocket attacks from Gaza.
On 17 July, it began ground operations intended to destroy tunnels used by militants to infiltrate Israel.
In his first comments since the 72-hour truce began, Israeli Prime Minister Benjamin Netanyahu blamed Hamas for all of the civilian casualties, saying it had used civilians as human shields.
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