"We could annihilate Bait Hanun and the rest of Gaza in a few hours. We certainly have the power to do so," Ze'ev Boim, Israel's deputy defence minister, told Gali Tzhal, the Israeli army radio.
Israel has one of the strongest armies in the world and is known to possess a huge stockpile of nuclear, chemical and biological weapons along with their delivery systems.
Other government officials have made similar belligerent remarks following Palestinian resistance attacks on an Israeli army outpost outside Khan Yunis in southern Gaza and a Jewish colony located in eastern Gaza.
Three Israelis were killed in the two attacks, which apparently were carried out in retaliation against the killing by the Israeli army of 13 Palestinian resistance figures earlier this week.
Meanwhile, the Israeli army continued to amass troops, tanks and armoured-personnel carriers outside Palestinian population centres and refugee camps in northern Gaza, apparently in preparation for a fresh incursion against suspected resistance groups.
Early on Tuesday morning, Israeli Apache helicopter gunships fired several rockets at a multi-storey building in central Gaza.
The Israeli army said the building, which houses several media offices, including Aljazeera TV, was "a Hamas building".
The building's owners and occupants denied the accusation.