Israel would like to sever its remaining connections with the Hamas-controlled Gaza Strip after militants blasted open the territory's border with Egypt, a top Israeli defence official said on Thursday.

"We need to understand that when Gaza is open to the other side we lose responsibility for it. So we want to disconnect from it," deputy Defence Minister Matan Vilnai told Army Radio.

He said Israel, which occupied the Gaza Strip in 1967, began to disengage from the territory in 2005 by pulling troops and settlers out. The Jewish state still controls Gaza's northern and eastern borders as well as its airspace and coastal waters.

Egyptian forces are posted along Gaza's southern border, where militants set off bombs on Wednesday destroying the border wall, allowing tens of thousands of Palestinians to pour through to stock up on goods in short supply due to an Israeli blockade.

Vilnai said Israel's effort to disengage from Gaza "continues in that we want to stop supplying electricity to them, stop supplying them with water and medicine, so that it would come from another place."

"We are responsible for it as long as there is no alternative," Vilnai said.

Israel says it has tightened its cordon around the Gaza Strip to prevent cross-border rocket attacks that have sown panic in southern Israel.