A day after an unprecedented Iranian attack on Israel, the Biden administration continues to urge Israel in private and in public not to rush into a massive retaliation, three U.S. officials said.

Why it matters: The U.S. assessment is Iran would retaliate against any significant, overt Israeli strike on Iranian soil with a new round of missile and drone attacks, a senior U.S. official said.

• The U.S. official said that would likely lead to a regional escalation.
• There is also a risk that efforts to defend Israel against more Iranian attacks would not be as successful as the coordinated defense on Sunday that intercepted nearly all of drones and missiles Iran launched at Israel, the official added.

State of play: During their phone call on Saturday, President Biden told Israeli Prime Minister Benjamin Netanyahu that he needs to think carefully and strategically about the danger of regional escalation as a result of Israeli retaliation to the Iranian attack, a senior U.S. official said in a call with reporters.

• The U.S. official said the Biden administration continued this conversation with the Israeli government on Sunday and stressed Israel needs to "be careful and strategic" with its response to the Iranian attack.
• "The Israelis are the ones who need to make these decisions but they had the upper hand yesterday. We will not be part of an Israeli offensive against Iran. Our goal is to avoid escalation and a regional conflict and contain the crisis to Gaza," the official said.
• The Israeli war cabinet met on Sunday for several hours and discussed several options for an Israeli retaliation, the prime minister's office said in a statement.
• An Israeli official briefed on the meeting said no decision has been made and more discussions will be held in the coming days.

Iran's Supreme National Security Council said in a statement on Sunday that no additional military action against Israel is currently on the agenda.

• It warned that any continued Israeli action against Iran would receive "at least a ten-fold response," the statement said.

Catch up quick: Iran launched attack drones and missiles against Israel on Saturday in retaliation for an airstrike in Syria that killed a top Iranian general.

• Iran said the strike hit its consulate in Damascus and was a violation of international law.
• Israeli officials claim the building was not a diplomatic facility but a site used by the Iranian Revolutionary Guard Corps (IRGC) for military operations.
• On Saturday, Iran fired nearly 350 drones, cruise missiles and ballistic missiles toward Israel, Israel Defense Forces (IDF) spokesperson Rear Adm. Daniel Hagari said. Most were intercepted outside of Israeli airspace.

Behind the scenes: On Saturday night, shortly after the Israeli war cabinet learned Iran launched the attack, ministers Benny Gantz and Gadi Eizenkot — both former IDF chiefs of staff — proposed to launch a counterattack immediately, three Israeli officials said.

• Gantz and Eizenkot claimed the longer Israel waits, the harder it will be to get international legitimacy for a counterattack, the officials said.
• They also claimed an immediate counterattack as the Iranian drones were still making their way to Israel would likely prevent Iran from launching another attack in response and would end the exchange of attacks.
• Netanyahu and other members of the war cabinet opposed the idea mainly because it wasn't clear yet whether the Iranian attack caused any damages or casualties, the officials said.
• One official said Netanyahu also wanted to wait for his phone call with President Biden. "There were several options for a retaliation but the call stopped it. This train has left the station and now we can take a breath and think about it again," the official said.

The big picture: Biden held a video conference call on Sunday with the leaders of the G7 countries. A source who was on the call said all leaders were concerned about a possible Israeli response that would lead to an escalation.

• The source said there was a decision that all G7 countries will tell Israel in private not to take steps that could lead to an escalation.
• In a statement after the meeting, the G7 leaders condemned the Iranian attack against Israel and expressed "full solidarity and support to Israel and its people and reaffirm our commitment towards its security."
• The G7 leaders said they will work to avoid further escalation in the region and demanded that Iran and its proxies cease their attacks.