Israel marks the second anniversary of the October 7, 2023, attack on Tuesday, as Hamas and Israeli negotiators hold indirect talks to end the two-year war in Gaza under a US-proposed peace plan.

Two years ago to the day, at the close of the Jewish festival of Sukkot, Hamas-led militants launched a surprise assault on Israel, making it the deadliest day in the country's history with 1,219 people, mostly civilians, killed on the Israeli side.

Militants also abducted 251 hostages into Gaza, of whom 47 remain captive, including 25 that the Israeli military says are dead.

Families and friends of those killed at the Nova music festival gathered at the site of the attack, where Hamas gunmen killed more than 370 people and seized dozens of hostages.

Another ceremony was due in Tel Aviv's Hostages Square, where weekly rallies have kept up calls for the captives' release.

A state-organised commemoration is planned for October 16.

Israel's retaliatory military campaign in Gaza by air, land and sea continues unabated, leaving tens of thousands of Palestinians dead and vast destruction.

The Hamas-run health ministry says at least 67,160 people have been killed, over half of them women and children, with the United Nations considering the figures credible.

Israel and Hamas now face mounting international pressure to end the war, with a UN probe last month accusing Israel of genocide in Gaza and rights groups accusing Hamas of war crimes in the October 7 attack. Both sides reject the allegations.

Last week, US President Donald Trump unveiled a 20-point plan calling for an immediate ceasefire once Hamas releases all hostages, the group's disarmament and a gradual Israeli withdrawal from Gaza.

Indirect talks began on Monday in Egypt's resort town of Sharm El-Sheikh, with mediators shuttling between delegations under tight security.

Al-Qahera News, which is linked to Egyptian state intelligence, said the discussions were focussed on "preparing ground conditions" for a hostage-prisoner exchange under Trump's plan.

A Palestinian source close to Hamas negotiators said the talks, which opened on the eve of the October 7 anniversary, may last several days.

Trump has urged negotiators to "move fast" to end the war in Gaza, where Israeli strikes continued on Monday.

Although both sides have welcomed Trump's proposal, reaching an agreement on its details is expected to be a Herculean task.

The war has previously seen two ceasefires that enabled the release of dozens of hostages. (AFP)