Residents in Ashkelon reported Thursday seeing Israel's new Iron Dome defense system intercept a Grad rocket fired towards the southern city from the Gaza Strip. IDF officials called the interception a "historical moment", saying it was the first of its kind in the world.

Two intercepting missiles were fired at the rocket, but the first succeeded in hitting it, an army official said.

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Moshe Ben Hemo, a resident of Ashkelon, said, "I was in the street and I heard a strange sound, like someone pushing the gas pedal of a car. Then I saw the rocket fly through the air and explode. Immediately I realized that it was Iron Dome, that's what has been said here."

He added that the rocket alert had not been set off. "The rocket was apparently supposed to explode in Ashkelon. In any case I'm glad the system works," he said.

After hitting a student bus traveling through Shaar Hanegev Regional Council Thursday, critically wounding a 16-year old boy and lightly injuring the driver, terrorists in Gaza fired some 45 rockets and mortar shells at Israel. No further injuries were reported.

The IDF immediately began bombing targets in Gaza in response to the onslaught. Palestinian medics said a 50-year old man was killed in the airstrikes along with three others, and a number of other people injured, including a child.

Ashkelon's Iron Dome system was set up just Monday, with soldiers running extensive tests to make sure it was functioning properly. Another system was set up earlier in Beersheba.

The defense establishment decided to place the system earlier than planned due to the recent escalation of violence in the south. It has already been set up in Haifa, and in the coming weeks officials plan to put it in place in central Israel as well.

Hamas: Stop Israeli aggression

Despite Thursday's onslaught, Hamas called on the international community to "stop Israel's aggression in the Gaza Strip". Hamas spokesman Taher Nunu said the organization would appeal to the UN Security Council because Israel was not honoring a lull agreement in Gaza.

The terror organization claims Israel is taking advantage of regret expressed by Judge Richard Goldstone over his report on Operation Cast Lead, which accuses Israel of war crimes, in order to attack the Palestinian people.

Hamas spokesman Fawzi Barhoum said the Palestinian fire, which included dozens of rockets and mortar shells after the attack on the bus, derives from a desire to protect the people of Gaza and "pressure the occupation to stop its crimes".

He added that the IDF was also trying to ignite violence "in order to thwart inter-Palestinian truce efforts" between Hamas and rival Fatah. He stressed that the Palestinian "will not sit by as innocent blood is shed".

Elior Levy and Hanan Greenberg contributed to this report