RAFAH, Gaza (Reuters) - The al-Attar family was praying and getting children ready for bed in southern Gaza when they heard a loud noise. Immediately fire erupted around their informal shack home, and the children started screaming.

Israel was pulverising Gaza again, and the airstrike left a fire raging on Sunday evening in a camp area designated for displaced people in Rafah city's Tel Al-Sultan district.

Terrified camp residents ran to try to escape the flames, survivors said.

"Our room was filled with shrapnel... Missiles or bombs weighing tons are falling on zinc," said Umm Mohamed al-Attar, surveying the wrecked camp of tents and corrugated metal shacks.

"There was a woman with disabled children who was martyred at the door of her room. What was her crime? ... Our neighbour, may God have mercy on him, was praying and was martyred; his brain ended up on the wall."

Gaza health authorities said 45 people, mostly women, children and the elderly, were killed. The toll prompted an outcry from global leaders, and Israel's top military prosecutor called the air strike "very grave" and said an investigation was under way.

Thousands of Palestinians had been sheltering in Tel Al-Sultan after Israeli forces began a ground offensive in the east of Rafah over two weeks ago.

After daybreak, people searched the debris for belongings.

"Gaza burns every day, every day and every hour. They (Israelis) were burned once, but we burn every day. Our children, our elders, our women, and our homes burn every day in Palestine," said Jamal al-Attar, a camp resident and Umm Mohammed's uncle.

Housewife Manal Salman surveyed the charred wrekcage.

"We were here in this very spot displaced, we were here in tents and suddenly we found rockets falling on us in the same place," she said.

"We didn't know where to go, it was dark and there were no ambulances, they didn't come straight away. We looked around - martyrs here and martyrs there - and now we're being displaced."

Retrieving items from the ruins of his temporary home, Talal Saeed Salman said his family would now have to move for the eighth time in the war.

"Where are we to go - help me understand, where are we to go?" he said, carrying a plastic tub.

"How long will we be disgraced like this?"

Commenting on the incident in Tel Al-Sultan, an Israeli government spokesperson said on Monday that initial reports coming from an overnight air strike against Hamas commanders in the Gazan city of Rafah was that a fire broke out after the strike, killing civilians.

More than 36,000 Palestinians have been killed in Israel's offensive, Gaza's health ministry says. Israel launched the operation after Hamas-led militants attacked southern Israeli communities on Oct. 7, killing around 1,200 people and seizing more than 250 hostages, according to Israeli tallies.

(Writing by Michael Georgy, Editing by William Maclean)

By Mohammed Salem