Israeli ground troops begin to withdraw from positions along the Gaza border after a truce with the territory's Hamas rulers came into effect.
The ceasefire was brokered after eight days of conflict that killed five Israelis and 162 Gazans, including 37 children.
In Gaza, the truce was celebrated as a success, with this newspaper headline reading "Gaza is victorious".
Palestinians here said they were proud of the resistance to the Israeli bombardment.
This resident said what happened was a lesson for Israel that will never be forgotten.
Israelis though were more sceptical about the ceasefire.
One resident of Sderot said the truce would not last.
(SOUNDBITE) (Hebrew) RESIDENT OF SDEROT SHLOMO:
"Judging by the history of agreements with Arabs, it seems a bit pessimistic. I think that rockets will return, it's only a matter of time."
Since the truce came into effect on Wednesday, a dozen rockets from Gaza landed in open areas in Israel, while there has been one blast in Gaza that caused no casualties.