Israel's military says that during an ongoing operation within the hospital compound its troops have found weapons, combat gear and technological equipment at the hospital in the Gaza Strip.
Israel has long accused Hamas of having a command centre under Gaza's biggest hospital and the US has said its intelligence backs this up, but Hamas has denied it.
The raid has attracted international condemnation, however, a top official at the Embassy of Israel in New Zealand, Yael Holan, told RNZ on Thursday that if civilian infrastructure was being used for military purposes, it could be considered a legitimate target.
There are thought to be thousands of people including medics, patients, babies, and displaced civilians inside.
MSF Australia president Katrina Penney said members had been providing medical support at the facility for decades.
"And certainly we've been hearing lots of testimonials that in the past month of the intense conflict we have seen no evidence that the hospital buildings or the compounds are being used by Hamas as a military base.
"In fact to the contrary; the hospital facilities have been trying to treat patients and trying to shelter civilians and their families at levels far beyond their capacity ..."
Penney told Morning Report the patients included babies needing ventilators and others needing intensive care facilities.
Communications have been limited since the raid, however, in the hours beforehand MSF had been told that staff were not able to get out and patients could not get in.
There had been no fuel, food, water or medicines and 7000 civilians plus 650 patients, and staff were being put at further risk.
"They've been hearing fighting outside, they've been hearing shots from the tanks, they've been hearing shots from snipers. They're now cowering trapped within the hospital, and they're not able to do what they should be able to do and that is to provide healthcare to the patients in the hospital.
"So under humanitarian law they're not able to provide this care and as we know, there's deliberate and repeated attacks on these hospitals, on the ambulances, [which] clearly violate international law."
Penney said MSF was adamant that international humanitarian law had been breached on multiple occasions. Its healthcare work which was neutral and impartial depended on governments observing this law.
"We are clear it [the law] is being violated."
MSF was expressing its concern about the situation to "as many people as would listen to us".
The organisation was "extremely worried" about the safety of staff, patients and anyone else in the hospital.
"We need an immediate ceasefire."
Hamas using hospitals 'very cynically, very brutally' - Israeli embassy
The deputy chief of mission at the Embassy of Israel in New Zealand, Yael Holan, said if civilian infrastructure, such as hospitals, was being used for military purposes, then it became a legitimate target.
She said she had seen the videos, released by the Israeli military today, which proved Hamas "without any doubt" was using the hospital for fighting.
She repeated that Hamas fighters were using hospitals and civilians as human shields "very cynically, very brutally".
She was also asked about the US government saying it did not want to see any hospital become a battleground and the United Nations saying the protection of babies, medical staff and civilians must override all other concerns. Holan responded this was not the case when the hospital was being used for military purposes.
Israeli forces were doing everything possible to limit civilian casualties during its current operation in Gaza, she said.
She added some of the hostages taken from Israel to Gaza by Hamas at the time of the 7 October attacks had suffered gunshot wounds and she had not heard any statement from MSF demanding that they be allowed to help them.
Israeli forces were continuing to gather evidence about Hamas activities within the hospital complex while also trying to ensure assistance could be given to patients and civilians, she said.
Asked about Israel's ultimate objective for Gaza, Holan said: "The only thing we know is that Hamas will not be ruling Gaza strip any more ..."
She did not know who would be in power. Israel's focus at present was getting rid of Hamas and freeing about 240 Israeli hostages taken captive on 7 October.
