Hudaydah is Yemen's biggest Red Sea port and serves as the lifeline for the majority of the country's population.
The United Nations and aids groups have been scrambling to stall the attack, warning that an assault on Hodeidah could spiral out of control, compounding already arguably the worst humanitarian disaster in the world.
Emirati-led troops have advanced along the southwestern coast to the outskirts of Hodeidah under a strategy to box in the Houthis in the capital Sanaa and cut off their supply lines to force them to the negotiating table.
The Saudi-led coalition did not immediately acknowledge the incident. The city and surrounding area are home to 600,000 people, and the port is the main route for food and aid to reach most Yemenis, 8.4 million of whom are on the verge of starvation.
The renewed push on Hodeidah comes amid increased tensions between Saudi Arabia and arch-foe Iran after the United States withdrew last month from an worldwide nuclear agreement with Tehran, a move hailed by Riyadh and Abu Dhabi.
The U.N. says some 600,000 people live in and around Hodeida, and "as many as 250,000 people may lose everything - even their lives" in the assault.
The U.N. International Committee of the Red Cross (ICRC) called on Wednesday for all sides in Yemen's war to protect civilians.
UN Secretary-General Antonio Guterres had said that UN envoy Martin Griffiths was in "intense negotiations" in an attempt to avoid a military confrontation.
"Under worldwide humanitarian law, parties to the conflict have to do everything possible to protect civilians and ensure they have access to the assistance they need to survive", Lise Grande, U.N. humanitarian coordinator for Yemen, told Reuters by email. However, Griffiths' recent appointment as envoy and his push for new negotiations might have encouraged the Saudi-led coalition to strengthen its hand ahead of any peace talks. An assault was "likely to exacerbate an already catastrophic humanitarian situation", Red Cross spokeswoman Marie-Claire Feghali said.
Defense Secretary Jim Mattis on Monday acknowledged the US continues to provide support to the Saudi-led coalition.
It said: "The Emiratis have informed us today that they will now give a three-day grace period for the United Nations (and their partners) to leave the city".
The government of exiled president Abd Rabbuh Mansour Hadi, partially based in Aden, issued a statement, claiming that the military operation was the last-ditch effort to "restore legitimacy to the entire national territory after exhausting all peaceful and political means to remove the Houthi militia from the port of Hodeidah".
The Houthis, with roots in a Zaidi Shi'ite minority that ruled a thousand-year kingdom in Yemen until 1962, deny they are pawns of Iran.
But once it became clear the Emirates would not hold back its allied Yemeni forces, American officials said they were focused instead on trying to ensure the operation did not damage key infrastructure such as the port as well as to ensure civilian sites did not become targets.
The assault comes following the expiry of a deadline set by the UAE for the Houthis, who hold Sanaa, to hand over the port that has been under their control for years. Saudi Arabia says Iran is backing the Houthis with weapons and logistical support - a charge Iran denies.
At the same time, the Trump administration has been seeking ways to demonstrate a tough stance toward Tehran's support of armed groups across the Middle East. Yemen, where Iran has provided only limited support for the Houthi movement, is seen as an easier starting point for that campaign than countries where its proxy support is more established.