The remarks followed a second day of protests against expansion of the site at the Cave of the Patriarchs in Hebron and Rachel's Tomb in Bethlehem. The Jewish monuments sit on land also claimed as holy by Muslims and Christians.
Netanyahu issued a statement calling the Palestinian protests "a campaign of lies and hypocrisy," Haaretz reported. Palestinians have accused Israel of expanding the sites as an attempt to steal the Palestinians' heritage.
To the contrary, Netanyahu said, Israel is obligated to ensure freedom of religion at all holy sites.
Soldiers Tuesday dispersed dozens of Palestinian youth who threw stones and burned tires in areas of Hebron under Israeli control, Ynetnews.com reported. No injuries were reported.
In a general strike, Palestinian Authority schools, government offices and businesses closed.
In a statement Monday, Robert Serry, a U.N. peace coordinator, urged Israel to avoid moves that would further distance Palestinians and Israelis and hurt prospects for peace negotiations.