Benjamin Netanyahu has accused Hamas of a “clear violation” of the Gaza ceasefire deal by releasing remains of a hostage already recovered by troops nearly two years ago.
The Israeli prime minister warned that Israel would respond after he discusses “next steps” with his defence chiefs later on Tuesday.
Far-right ministers Bezalel Smotrich and Itamar Ben-Gvir urged him to take tough action.
Mr Netanyahu‘s threat increases fears over the sustainability of the three-week-old truce.
Thirteen hostages’ bodies are still thought to be in the enclave and Israel has accused Hamas of deliberately stalling.
All 20 living hostages have already been freed in exchange for about 2,000 Palestinian prisoners, but the remains of the dead have been slow to be repatriated.
Hamas has said there are problems finding them due to a lack of equipment to sift through the devastation and rubble in Gaza.
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Spokesperson Hazem Qassem told Reuters: “Hamas will continue to exert every effort possible to hand over the remaining bodies until this issue is fully concluded and as soon as possible.”
The Red Cross and a “technical team” from Egypt with an excavator and bulldozers joined efforts to find the remains at the weekend after getting Mr Netanyahu’s approval.
Israeli soldiers previously recovered the remains of 51 hostages from Gaza – and it’s one of these victims that the remains released overnight are said to belong to.
President Trump warned on Saturday he is “watching very closely” to ensure Hamas returns the bodies.
Israel has so far handed back 195 Palestinian bodies – fewer than half of which have been identified – in return for its dead hostages.
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Despite the fragile truce in Gaza, violence in the occupied West Bank continues to flare up and Israeli authorities said on Tuesday they had killed three Palestinian militants.
Police said the men were shot as they left a cave near Jenin, while the military said they had been involved in “terror activity” in the city and that an airstrike later destroyed the cave.
Hamas condemned the strike but did not confirm the men were members of the group.
Israel says it is cracking down on militants in the West Bank, but Palestinians and human rights groups say many civilians have also been killed and tens of thousands of people displaced from their homes.
