The decision was made "after a large majority of cabinet ministers concluded that the alternative plan presented to them would not achieve the defeat of Hamas or the return of the hostages," the statement said.
Prime Minister Netanyahu's office has released a statement detailing five principles for the invasion of Gaza City and the end of the war, which were approved by a majority vote in the cabinet.
"The Israeli Defense Ministry is preparing to take control of Gaza City and provide humanitarian aid to civilians outside the war zone," he said.
The five demands include disarming Hamas, returning all hostages, including both alive and dead, demilitarizing the Gaza Strip, removing Hamas from Gaza, and establishing an alternative civilian government to the Palestinian Authority that governs the West Bank.