The military's statement, posted on X, appeared to signal further escalation after more than 120 strikes on Tuesday hit Lebanon's south and east, despite a ceasefire announced on April 16.
"We advise residents of southern Lebanon to evacuate to the north of the Zahrani River, as all areas south of the river are considered a combat zone," an Israeli military spokesman posted on X.
The Zahrani River runs east to west about 40km north of Israel's border with Lebanon, and the Lebanese territory south of it covers about 2000 square kilometres.
Israeli Prime Minister Benjamin Netanyahu said on Tuesday that Israel needed to take further action in Lebanon to protect communities in northern Israel from Hezbollah.
The Israeli military has previously ordered people below the Litani River further south to leave.
It already issued individual evacuation orders and carried out strikes in several dozen towns between the Litani and Zahrani.
Wednesday's order was the first time that residents were ordered to leave the entire zone south of the Zahrani.
The Israeli military urged civilians to stay away from Hezbollah operatives, facilities and weapons sites.
Lebanese security sources told Reuters that people were fleeing north to the port city of Sidon, already hosting thousands of displaced from other parts of southern Lebanon.
The new statement came as Muslims across Lebanon were celebrating Eid al-Adha.
More than 1.2 million Lebanese have been displaced by Israeli strikes and orders to move since March 2, when Hezbollah fired at Israel in support of its ally Iran.
Since then, Israeli strikes have pummelled Lebanon's south, east and its capital Beirut, killing more than 3200 people, according to Lebanon's health ministry.
Fighting has continued in southern Lebanon despite a US-brokered ceasefire announced on April 16.
The World Health Organisation has said at least 608 people in Lebanon have been killed in Israeli attacks since the truce.
The Israeli military said that 10 of its soldiers had been killed since the April 16 ceasefire, six of them by Hezbollah's explosive drones.
The Israeli military expanded its ground operations in southern Lebanon past a security zone its troops are occupying but gave no details on the extent of the advance beyond the so-called Yellow Line.
The Lebanese capital Beirut has been spared new strikes although Israeli surveillance drones are heard buzzing above the city every day and a warplane was heard flying low on Wednesday, according to Reuters reporters there.
Three senior Israeli officials said Israel believes it has freedom of action in southern Lebanon but less so in Beirut.
The officials told Reuters that Israel does not want to be seen as derailing US President Donald Trump's potential deal with Iran by knocking down buildings in the Lebanese capital.
