The number of Palestinian rocket attacks dropped sharply after the deal took effect overnight, with less than ten reportedly fired since then.
Prime Minister Benjamin Netanyahu signalled Israel’s commitment to the deal, while warning of a strong response to any violations.
“Our message is that quiet will bring quiet,” Mr Netanyahu said. “Anyone who violates it or even tries to violate it, our guns will find him.”
The worst flare-up of violence along the frontier in months began on Friday after Israel killed a senior militant it accused of plotting to attack Israel from Egyptian territory.
Israel said Gaza militants had fired about 200 rockets at southern towns and cities since then. Eight Israelis were injured. At least 80 Palestinians, mostly civilians, were wounded in Israeli attacks.
“We expect this ceasefire to continue but we cannot be sure so our forces… are ready to continue if it will end up being necessary,” Israeli defence minister Ehud Barak, visiting southern Israel, told reporters.
“It was quite a successful round,” he said, citing the deaths of 20 militants among the 25 Palestinians killed in Israeli attacks and what he termed the “impressively effective” Iron Dome rocket interception system. The anti-missile batteries destroyed dozens of incoming rockets but disrupted normal life for more than a million Israelis, forcing schools to close.