US Secretary of State Anthony Blinken says Palestinians should not be pressured to leave Gaza and should be allowed to return to their homes once conditions permit.
Mr Blinken condemned statements by some Israeli ministers who called for Palestinians to be resettled elsewhere.
The US official was in Qatar on his latest tour of the Middle East.
His comments followed reports that up to 70 people had been killed in the Jabaliya refugee camp in northern Gaza.
Footage from Jabaliya showed bodies – many of them women and children – lying in the rubble of a destroyed building.
A spokesman for the Israel Defense Forces (IDF) told the BBC that “the attack was carried out against a military target in an attack” and that “it is not aware of the specific number of casualties”.
“In response to Hamas' barbaric attacks, the IDF is working to cripple Hamas' military and administrative capabilities,” they said, adding that the IDF “follows international law and takes possible precautions to mitigate civilian harm.”
More than 60 Palestinians were reportedly killed in the southern city of Khan Younis in the past day.
The Jabalia camp has been attacked several times since Israel launched its war against Hamas following an unprecedented attack by Hamas militants on southern Israel on October 7.
The Hamas attack killed about 1,200 people – most of them civilians – and took about 240 hostages.
More than 22,000 people – mostly women and children – were killed in Gaza, according to the Hamas-run health ministry. At least 113 deaths were reported in 24 hours of Israeli bombing.
“Palestinian civilians will be able to return home as soon as conditions permit,” Mr Blinken said on Sunday. “They can't, they shouldn't be pressured to leave Gaza.”
Israel's far-right finance minister, Bezalel Smodrich, has called for Palestinians to leave Gaza to make way for Israelis to “bloom the desert”.
Another far-right politician, National Defense Minister Itamar Ben-Ghir, called this week to “encourage the migration of Gaza residents” as a “solution” to the crisis.
The official line from the Israeli government is that Gazans will eventually be able to return to their homes, although it has not outlined how or when this will be possible.
Meanwhile, the situation in Gaza continues to deteriorate. Even medical facilities, including hospitals, are now unsafe, health officials said.
Three international medical aid groups have announced they will leave Al-Aqsa Hospital in central Gaza after Israel issued evacuation orders.
A representative of the United Nations Office for the Coordination of Humanitarian Affairs (OCHA) told the BBC World Service's Newshour program that they were “deeply concerned by this development”.
“What that means is that a hospital that is already overcrowded and overburdened and beyond its capacity is now without absolutely critical reinforcement to support it as it deals with rising casualties,” Gemma Connell said.
World Health Organization chief Tedros Adhanom Ghebreyesus said more than 600 patients and health workers had been forced to leave hospitals, its director said.
“Their locations are currently unknown,” Mr Tedros posted on X, formerly known as Twitter.
Mr Blinken's trip to the Middle East comes amid rising tensions in the region, with concerns that war could spread to Gaza.
Saleh al-Aruri, a top Hamas official, was killed in an Israeli strike in south Beirut on Tuesday, along with six others – two Hamas military commanders and four members.
Hassan Nasrallah, head of Lebanon's powerful pro-Iranian movement Hezbollah, described Aruri's assassination as a “filthy Israeli occupation” that would not go unpunished.
Hezbollah fired rockets into Israel on Saturday as a “preliminary response” to the killing of Aruri.
“This is a moment of deep tension in the region. It is a conflict that is volatile, causing more insecurity and more suffering,” Mr Blinken said.
Qatar's Prime Minister Sheikh Mohammed bin Abdulrahman Al-Thani said Aroori's killing had affected a “complex process”.
He added that “innocent Palestinian men, women and children” had died in the war.
Mr Blinken arrived in Qatar following stops in Jordan, Turkey and Greece. He left for Abu Dhabi late on Sunday and is scheduled to leave for Saudi Arabia on Monday.