The ruling has drawn added attention because it comes against the backdrop of the Israel-Hamas war in Gaza.

The Palestinian leadership hailed as "historic" Friday a ruling by the top UN court that Israel's occupation of the Palestinian territories is illegal but the opinion drew condemnation from Israel.

Prime Minister Benjamin Netanyahu said the International Court of Justice had made a "decision of lies" by finding that Israel's policies and practices "amount to annexation of large parts" of the occupied territories.

The office of Palestinian president Mahmoud Abbas said it welcomed the "historic decision and demands that Israel be compelled to implement it."

In its non-binding advisory opinion, The Hague-based court found that Israel was "under an obligation to cease immediately all new settlement activities and to evacuate all settlers" from occupied land.

The ruling has drawn added attention because it comes against the backdrop of the Israel-Hamas war in Gaza.

Netanyahu led a chorus of condemnation from conservative, far-right and even centrist politicians in Israel.

Palestinians inspect the damage of a destroyed house following an Israeli airstrike in Jabaliya refugee camp, Gaza. AP

"The Jewish people are not occupiers in their own land -- not in our eternal capital Jerusalem, nor in our ancestral heritage of Judea and Samaria" (the occupied West Bank), Netanyahu said in a statement.

"No decision of lies in The Hague will distort this historical truth, and similarly, the legality of Israeli settlements in all parts of our homeland cannot be disputed."

In the English-language version of his statement, Netanyahu called the decision "absurd", instead of "lies" as he said in the Hebrew version.

Itamar Ben Gvir, the far-right national security minister and a settler himself, called the ICJ "a blatantly anti-Semitic and political organisation".

In comments sent to AFP by a spokesperson, Ben Gvir called for annexation of the occupied territories.

Centrist opposition leader Yair Lapid said the court's ruling was "disconnected, one-sided, tainted with anti-Semitism and lacking an understanding of the reality on the ground".

The Palestinian presidency said: "The ICJ ruling renews hope among our people for a future free from colonisation."

Palestinians leave Rafah for Khan Yunis after Israel pulled its ground forces. AFP

The foreign ministry called the ruling a "watershed moment".

"Israel is under an obligation to end this illegal colonial enterprise unconditionally, and in our view, that means immediately and totally," it said.

The ICJ ruling comes in response to a UN General Assembly query in 2022 regarding the legal consequences of Israel's "prolonged occupation, settlement and annexation of the Palestinian territory occupied since 1967".

In the Six-Day War of 1967, Israel occupied the Gaza Strip and the West Bank, including east Jerusalem which it swiftly annexed.

The UN later declared the occupation of Palestinian territory illegal.

A separate ICJ case brought by South Africa alleges that Israel's Gaza offensive, launched after the October 7 Hamas attacks on Israel, breached the 1948 UN Genocide Convention. Israel has strongly denied the accusation.

Agence France-Presse