DAMASCUS, March 1 (Reuters) - Hamas vowed on Saturday to keep up armed resistance against Israel even if the Jewish state launched an all-out invasion of Gaza.

Palestinian fighters battling Israeli forces in the coastal strip had little option but to keep firing rockets on the Jewish state and resist "Israeli aggression", exiled Hamas leader Khaled Meshaal said in the Syrian capital.

"No one in his right mind would like to see Israel invade Gaza, but the battle has been forced on us. The rockets are a reaction. Israeli aggression came first," Meshaal said.

"We won't surrender. Rockets are the arsenal we have to protect our people. The only option in front of us is resistance and self-defence," Meshaal told reporters.

Israel killed 41 Palestinians on Saturday in its deadliest and deepest incursion into the Gaza Strip since pulling out in 2005, stoking fears of a broader conflict that could derail renewed U.S.-backed peace talks.

It said it was responding to cross-border rockets, which killed an Israeli man in the border town of Sderot on Wednesday and wounded others in the southern city of Ashkelon.

At least 76 Palestinians have been killed since Wednesday in intense Israeli air strikes and ground raids in the tiny Hamas-controlled territory, home to 1.5 million people, bordering Israel, Egypt and the Mediterranean.

Two Israeli soldiers were also killed and seven wounded, the army said -- its first casualties in four days of fighting.

Meshaal dismissed suggestions that Hamas should declare a truce, saying similar moves by the Islamist movement between 2003 and 2006 had not helped end Israeli attacks.

He told Israel what he believed it would face if it mounted an invasion: "I say to the Zionist leaders, if they decided to raid Gaza, they will not be fought by dozens of fighters but they will be fought by 1.5 million people."

Responding to a warning by an Israeli official that Palestinians in Gaza faced a "shoah", or holocaust if rocket fire did not end, Meshaal said the Palestinians have been the subject of a holocaust since Israel came into being in 1948.

An aide said the Israeli official meant "disaster" rather than "holocaust", the word's more common meaning. (Reporting by Khaled Yacoub Oweis, editing by Myra MacDonald)

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