Palestinian Islamic Jihad (PIJ) militants said the truce will begin at 23:30 local time (20:30 GMT), after talks moderated by Egyptian mediators.
Israeli Prime Minister Yair Lapid's office confirmed the ceasefire.
The latest violence is the most serious flare-up between Israel and Gaza since an 11-day conflict in May 2021.
The Israeli military confirmed it was striking Islamic Jihad targets in Gaza as the ceasefire came into force in response to rockets fired just before, and Israeli media reported some isolated rocket fire from Gaza in the minutes after.
But the ceasefire largely appears to be holding since then.
The Israeli military said it began the latest attack on sites in the Gaza Strip in response to threats from a militant group. It followed days of tensions after Israel arrested a senior PIJ member in the occupied West Bank.
By Sunday evening, the Palestinian health ministry said that 15 children had been confirmed among the 43 deaths recorded in the latest violence. Gaza's health ministry has blamed "Israeli aggression" for the deaths of Palestinians and for the more than 300 people wounded.
Earlier on Sunday, rockets fired from Gaza reached Jerusalem for the first time since May last year.
The ceasefire was mediated by Egypt over the course of the day.