Defence Minister Israel Katz's comments come weeks into a renewed offensive by the military on the war-battered territory, which has displaced hundreds of thousands, while an aid blockade has revived the spectre of famine for its 2.4 million people.
French President Emmanuel Macron meanwhile said that France plans to recognise a Palestinian state in the "coming months", a move that risks antagonising Israel which insists such moves by foreign states are premature.
Katz said that "large areas are being seized and added to Israel's security zones, leaving Gaza smaller and more isolated", during a visit to the newly announced Morag Corridor between the southern cities of Rafah and Khan Yunis.
Katz emphasised that Israel would keep increasing pressure on Gaza "until the hostages are freed and Hamas is defeated".
Katz also said that Israel was encouraging plans for "voluntary emigration... in accordance with the vision of the US president, which we are working to implement".
US President Donald Trump had earlier this year proposed a plan to develop Gaza into a "Riviera of the Middle East" while displacing its population elsewhere.
Gaza's civil defence agency meanwhile said an Israeli air strike on a residential building in Gaza City killed at least 23 people, most of them children or women, while the military said it targeted a "senior Hamas" militant.
The strike took place in the Shujaiya neighbourhood of Gaza City, the agency's spokesman Mahmud Bassal told AFP.
"There are still people trapped under the rubble," he said.
- 'Torn to pieces' -
Ayub Salim, a 26-year-old Shujaiya resident, told AFP that the area was hit with "multiple missiles" and was "overcrowded with tents, displaced people and homes".
"Dust and massive destruction filled the entire place, we couldn't see anything, just the screams and panic of the people."
Salim said the dead were "torn to pieces".
A crew from the Gaza civil defence agency rushed to the scene, only to find several people trapped under the rubble, a rescuer said.
"This house was home to many people who believed they were safe. It was blown up over their heads," rescuer Ibrahim Abu al-Rish told AFP.
"We pulled out the remains of women and children. There are still people buried under the rubble," he said.
First responders and neighbours worked to break through the concrete floor of an entire storey that collapsed in the strike and trapped residents, AFP footage showed.
Taking turns swinging a sledgehammer through the thick, hard surface, they eventually broke a hole through which the bodies of children were extracted and taken away wrapped in dusty blankets.
- 'Move towards recognition' -
When asked by AFP about the strike, the Israeli military said it "struck a senior Hamas terrorist who was responsible for planning and executing terrorist attacks" from the area. It did not give the target's name.
Hamas condemned the strike as one of the "most heinous acts of genocide."
Israel resumed intense strikes on the Gaza Strip on March 18, ending a two-month ceasefire with Hamas. Efforts to restore the truce have so far failed.
The health ministry in the Hamas-run territory said on Wednesday that at least 1,482 Palestinians have been killed in the renewed Israeli operations, taking the overall death toll since the start of the war to 50,846.
Hamas's October 2023 attack that triggered the war resulted in the deaths of 1,218 people on the Israeli side, mostly civilians, according to an AFP tally based on Israeli official figures.
The strike came as CIA chief John Ratcliffe visited Jerusalem on Wednesday, days before the US holds nuclear talks with Iran and amid continued attempts to revive a ceasefire in Gaza.
Meanwhile, Macron said France could recognise a Palestinian state as early as June.
"We must move towards recognition, and we will do so in the coming months," Macron told France 5 television.
"I believe that at some point it will be right and because I also want to participate in a collective dynamic, which must also allow all those who defend Palestine to recognise Israel in turn, which many of them do not do," he added.
Palestinian minister of state for foreign affairs Varsen Aghabekian Shahin told AFP that France's recognition of Palestinian statehood "would be a step in the right direction in line with safeguarding the rights of the Palestinian people and the two state solution".
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