The latest violence has caused widespread destruction
Binyamin Ben Eliezer was speaking after Israeli troops completed a withdrawal from Palestinian-ruled Bethlehem and nearby Beit Jala.
The United States welcomed the Israeli move, but urged Israel to pull out of the other Palestinian-controlled areas in the West Bank.
A report by a UN human rights investigator says that Israel and the Palestinian authority should agree on the deployment of international monitors or peacekeepers to oversee any ceasefire agreement.
The BBC's United Nations correspondent says the new report labels Israel as an occupying power in Palestinian areas, and accuses the Israeli army of using excessive force against Palestinian protesters and gunmen.
The report's author, UN human rights investigator John Dugard, says he finds it difficult to understand why the international community does not put more pressure on Israel to accept international monitors or peacekeepers.
Following the weekend's violence, parts of Bethlehem were left looking like a war zone, with several houses close to Manger Square destroyed.
Shop fronts were demolished and buildings scarred by bullets and tank fire.
The Israeli withdrawal came despite two shooting attacks by Palestinian militants on Sunday that killed five people in northern Israel.
The Israelis said the pull-out was a test case for withdrawals from four other towns they entered 10 days ago - Jenin, Qalqilya, Ramallah and Tulkarm.
Further withdrawals could proceed "the moment anyone gets up on the Palestinian side and says they take responsibility for security," Mr Ben Eliezer said.
Palestinian casualties
The Palestinian Mayor of Bethlehem, Hanna Nasser, said the Israeli operation had left a legacy of hatred, and cost the Palestinians about $18m in lost revenue.
Other Palestinian officials said at least 20 Palestinians had been killed during the incursion.
Israel moved forces into and around the six Palestinian-run towns and cities in the West Bank on 17 October in response to the assassination of Israeli Tourism Minister Rehavam Zeevi.
At least 40 Palestinians have died in clashes since then.
US pressure
The United States, which has been trying to calm a year of Israeli-Palestinian violence as it pursues its military campaign in Afghanistan, is pressuring Israel's Prime Minister Ariel Sharon to withdraw from the remaining towns quickly.
"We want to see it go through immediately, we are encouraging them to continue this process and see it go through all the way," said US State Department spokesman Richard Boucher.
Israeli foreign policy adviser Danny Analon has told the BBC that Mr Sharon's visit to the United States planned for early November "is on schedule".
If Mr Sharon's visit takes place while Israeli forces are still occupying Palestinian towns he can expect a hostile reception, the BBC's Middle East analyst Roger Hardy says.
The Israeli military offensive has led to unusually strong condemnation from senior US officials and has strained US-Israeli relations.
Sunday attack
Sunday saw two Palestinian gunmen kill four women and wound up to 14 others in the coastal city of Hadera, north of Tel Aviv, hours after an Israeli soldier was shot dead in the same area.
The militant Palestinian group Islamic Jihad said in a videotaped statement that its men - who fired at random from a car before being shot dead by police - carried out the attack.
Hadera is at one of Israel's narrowest points, just a few kilometres from the West Bank, and it has frequently come under attack by Palestinian militants.