"If I continued to serve in my position, I would not have been able to look into the eyes of the residents of the south", Liberman said. Believe me, they are precious to me, their words penetrate my heart.
"In times of emergency, when making decisions crucial to security, the public can't always be privy to the considerations that must be hidden from the enemy", he said at a ceremony on Wednesday morning in honour of Israel's founding father David Ben-Gurion.
Tourism Minister Yariv Levin, the first from the government to respond, called the resignation a "gift to Hamas" - a sentiment seemingly shared by senior Hamas political leader Sami Abu Zahri, who called it a "recognition of defeat".
Hamas, which has ruled the packed and impoverished coastal enclave since 2007, claimed victory and celebrations broke out.
In Gaza, hundreds of people celebrated their perceived win in this last round of escalation against Israel.
In that 50-day war, more than 2,100 Palestinians were killed in Gaza, a lot of them civilians, along with 66 Israeli soldiers and seven civilians in Israel. "Our enemies have pleaded for a cease-fire, and they know very well why", he said.
The clash that resulted from the blown covert operation martyred seven Palestinians, including a local Hamas military commander, as well as an Israeli army officer.
Announcing his decision in a news conference, which takes effect 48 hours after he puts it in writing, Lieberman deemed Tuesday's Egyptian-mediated deal with the Palestinian group Hamas "a capitulation to terror".
At least 234 Palestinians in Gaza have since been martyred by Israeli fire, the majority during protests and clashes.
Responding with dozens of air strikes, Israel hit dozens of buildings including the Hamas-run TV station, Al-Aqsa.
The Gaza health ministry says that 25 people have been injured.
Rather, he told Ynet TV, Israel had "landed a harsh and unprecedented blow on Hamas and the terrorist groups in Gaza, and we will see if that will suffice or whether further blows will be required".
Lieberman, one of the hawkish figures in Netanyahu's cabinet that include various right-wing parties, was considered responsible for the botched Israeli raid in Gaza on Sunday, which gave way to the worst violence between Israel and Palestinians since a 2014 war.
The announcement came shortly after Netanyahu's Security Cabinet ended a seven-hour discussion on the rising tensions in Gaza.
Before Sunday's raid, Egyptian and United Nations mediators had made progress in reducing tensions. The blockade has ravaged Gaza's economy, and Israel refuses to lift it unless Hamas disarms, a demand rejected by the militant group, which is pledged to Israel's destruction.
Demonstrators each week approach the border fence, throwing firebombs, grenades and burning tires at Israeli troops. In recent days, Israel had allowed fuel shipments to increase the power supply in Gaza, which suffers from frequent blackouts, and agreed to additional Qatari assistance to allow Hamas to pay the salaries of its thousands of government workers.
Israel said it was an intelligence-gathering operation and that those efforts must continue to defend the country. An anti-tank missile hit a bus that Hamas says was being used by Israeli soldiers. Seventy-three people, a lot of them soldiers, were killed on the Israeli side.