Israel has been cast as a "pantomime villain" in Britain, Mr Prosor said
The government has hit back at claims by Israel's ambassador to Britain that the UK has become a "hotbed for radical anti-Israeli views".
In a Daily Telegraph article, Ron Prosor wrote that a "climate of hatred" towards Israel had been stirred up on British university campuses.
But Higher Education Minister Bill Rammell denied Mr Prosor's remarks.
He said any such "uncomfortable or distasteful" views were held only by a "small minority".
Mr Prosor said that he admired Britain's tradition of decency and fair play, but that the debate over Israel had been "hijacked by extremists".
Israel had been cast as the "pantomime villain", he added, and media coverage of the Israeli-Palestinian conflict was "routinely tainted with bias".
"Britain has become a hotbed for radical anti-Israeli views and a haven for disingenuous calls for a 'one-state solution', a euphemistic name for a movement advocating Israel's destruction," he said.
"Over-simplifications, half-truths and lies have been swallowed as reality and disseminated as truth.
"The complexities of the situation are overlooked, as are the responsibilities of other actors in the region."
He said that most Britons would be unaware of the "1,400 rockets and 1,500 mortar bombs" which had landed on Israeli soil since Hamas took control of Gaza in 2007.
The ambassador also attacked a decision by lecturers to explore the possibility of a boycott of Israeli universities, which he said would be a licence to "harass, humiliate and victimise".
In May 2008, the University and College Union (UCU) stopped short of voting to cut ties with Israeli counterparts, but its congress instead agreed a motion to "consider the moral and political implications of education links with institutions".
Mr Prosor said: "The concept of an academic boycott is a ludicrous oxymoron, undermining the democratic principles of free speech and free debate.
"Alarmingly, these values are under threat in an institution that should be safeguarding them."
But Mr Rammell said he did not agree that there was "widespread radical anti-Israeli sentiment" on university campuses.
"I do not believe calls for academic boycotts of Israel have anything more than small minority support amongst academics," he said.
"Universities have a vital role to play in challenging those views that we may regard as uncomfortable or distasteful and, where such views do exist, it is the responsibility of staff and students to isolate the very small minority who promote extremism.
"The government is completely opposed to any form of academic boycott of Israel, which will harm rather than help moves towards peace and reconciliation in the Middle-East."
A spokesman for the Universities and Colleges Union said the ambassador was misinformed.
He said no boycott had been agreed and the union's executive had still to meet to decide how to implement the congress's decision.
"I'm guessing the ambassador hasn't read the motion and is going on what has been reported elsewhere," he added.