Palestinians, many of whom had spent 11 days huddled in fear of Israeli shelling, poured into Gaza's streets.
Mosque loud-speakers feted "the victory of the resistance achieved over the Occupation (Israel) during the 'Sword of Jerusalem' battle."
In the countdown to the 2 a.m. (2300 GMT Thursday) cease-fire, Palestinian rocket salvoes continued and Israel carried out at least one air strike.
Each side said it stood ready to retaliate for any truce violations by the other. Cairo said it would send two delegations to monitor the ceasefire.
The violence erupted on May 10, triggered by Palestinians' anger at what they assailed as Israeli curbs on their rights in Jerusalem, including during police confrontations with protesters at Al-Aqsa mosque during the Ramadan fasting month.
The fighting meant many Palestinians in Gaza could not mark the Eid al-Fitr festival at Ramadan's conclusion. On Friday, throughout Gaza, postponed Eid al-Fitr meals were held instead.
In Israel, radio stations that had carried around-the-clock news and commentary switched back to pop music and folk songs.
Gaza health officials said 232 Palestinians, including 65 children, had been killed and more than 1,900 wounded in aerial bombardments.
Israel said it had killed at least 160 combatants.
Authorities put the death toll in Israel at 12, with hundreds of people treated for injuries in rocket attacks that caused panic and sent people rushing into shelters.