In a statement released after a meeting in Brussels on Monday, EU foreign ministers said, "The European Union calls for an urgent de-escalation and cessation of hostilities."
"It [EU] supports the efforts of Egypt and other actors to mediate for a rapid ceasefire."
In Cairo, mediators said a peaceful solution could be close, after days of Israeli air strikes on Gaza and rocket fire from the Hamas controlled territory. Israel began its military offensive against Gaza on 14 November, marking the latest eruption in a conflict with Palestinian militants.
The latest violence has seen 101 Palestinians and three Israelis dead, with a further 800 people injured. Israel and Hamas are facing growing international pressure to stop the violence.
EU foreign policy chief Catherine Ashton said, "I am very concerned about the loss of life, but I've also been saying consistently for a long time that we need to find a long-term solution."
"I am very concerned about the loss of life, but I've also been saying consistently for a long time that we need to find a long-term solution" - Catherine Ashton
Laurent Fabius, the French foreign minister visited both Israel and Palestinian on Sunday, and said his country was working alongside Egypt to attempt to secure a ceasefire agreement. "We absolutely need an urgent ceasefire because what is happening in Gaza and in Israel is extremely serious," Fabius argued.
Germany's foreign minister Guido Westerwelle said the first condition for a ceasefire was to end Gaza's rocket attacks on Israel. "If a ceasefire is to bring lasting peace, then it is necessary that the rocket attacks on Israel from Gaza are stopped. That is the key issue for everything else", he warned.
While British foreign secretary, William Hague said "Israel has responsibilities too, to take every opportunity to de-escalate the violence, to avoid civilian casualties, to observe international humanitarian law."
Meanwhile the EU is currently facing a dilemma in its policy towards Palestine, as the 27-member bloc has good relations with the Palestinian Authority and is its main aid donor.
In 2012, Brussels had sent €200m to the Palestinians and without this support, the administration and a good portion of the infrastructure would struggle to function. However, Brussels has designated Hamas a terrorist organisation and therefore maintains no official contacts with the group.
"Israel has responsibilities too, to take every opportunity to de-escalate the violence, to avoid civilian casualties, to observe international humanitarian law" - UK foreign secretary William Hague
European commission president José Manuel Barroso said during a trip to the West Bank last July that reconciliation between Fatah and Hamas is a "key factor for the unity of a future Palestinian state and for the achievement of a two-state solution".
In a sign of divisions over the Israeli-Palestinian conflict, EU ministers are struggling to find a unified position on Palestinian efforts to secure a diplomatic upgrade at the United Nations.
Despite the increase in violence between Gaza and Israel, Palestinian president Mahmoud Abbas has said he would push ahead with plans for a vote at the UN general assembly before the end of the month to give the Palestinians the status of "observer state".
Currently only considered an observer "entity" at the UN, the upgrade would enhance Palestinians' legal rights at a time when peace negotiations have hit a wall over Israel's refusal to halt settlement building.
Both Israel and the US have condemned the planned vote arguing that it violates previous agreements and will make any future peace talks more difficult.