
One turbine at the plant was shut down on Sunday, causing blackouts.
The shut-down late on Monday of the remaining two turbines left much of Gaza City in darkness, a local resident told the BBC.
industrial fuel shipments from Israel were halted last week after fierce border clashes and rocket fire.
The Israeli military staged an incursion into Gaza and sent air strikes, killing at least seven Palestinian militants, while militants fired a barrage of rockets into southern Israel.
Hospital fears
The Gaza City plant provides about a quarter of Gaza's electricity, and more than half the electricity used by the city itself.
Without a grid system, they have no way to divert power to essential utilities such as hospitals or sewage treatment works. Aid agencies had warned of a serious threat to public health if the plant went offline.