Chancellor Angela Merkel in a call to Israeli Prime Minister Ehud Olmert urged "a ceasefire as soon as possible in the Gaza strip" but on condition that Israel's security was guaranteed, a government statement said.
In particular "it must be ensured that the smuggling of weapons in the Gaza strip is prevented," she said.
An earlier statement Sunday by Foreign Minister Frank-Walter Steinmeier said he was "very worried" by the further escalation of fighting. "This makes it all the more urgent work ... to create the conditions for a ceasefire."
But he added: "This must guarantee Israel's long-term security. This does not only mean that Hamas at last stops firing rockets. The smuggling of weapons into the Gaza Strip must also be properly prevented."
The comments came as Israeli soldiers and tanks pushed into Gaza on Sunday, after a week of aerial bombardment in which 460 Palestinians died, according to medics in Gaza. Rocket fire from Gaza over the same period has killed four Israelis.
The Israeli ground offensive in the Gaza has deepened anger and anxiety around Germany. While tens of thousands took to the streets in protest against Israel's military action at the weekend, the Green party accused Chancellor Merkel of doing too little to intervene.
Green party leader Claudia Roth said on Sunday, “Why is Angela Merkel keeping quiet? Why is the Chancellor not doing anything to achieve an immediate ceasefire, and a lasting strategy to resolve the conflict?”
Roth warned Merkel not to confine herself to declaring Israel's military action as legitimate. “That is not a helpful contribution to resolving this problem,” she said.
The Green party leader admitted that Israel had the right to protect its people from the radical Islamic group Hamas, but said the current military action only escalated the conflict. She called on both sides to stop the violence immediately.
Wolfgang Gehrcke, foreign policy expert for the left-wing party Die Linke, said the role of German and European political leaders now was to demand a ceasefire from Israel. “The choice is not between Israel and Palestine, but between war and peace negotiations,” he said.
Tens of thousands have taken to the streets of Germany's major cities this weekend to call for peace in the Middle East. Police reported 7,500 people taking part in demonstrations in Berlin, and another 7,000 in Frankfurt. There have also been rallies in Bremen, Düsseldorf, Karlsruhe and other towns.