Taoiseach Leo Varadkar has said the Israeli ambassador will not be expelled from Ireland in response to the conflict in Gaza.
Opposition TDs have called for the ambassador's expulsion after almost 60 Palestinians were killed and more than 2,700 injured by Israeli forces during protests on Monday.
Mr Varadkar said he was profoundly shocked by the death toll.
He said: "There is no indication that the scale of the threat could have justified such violence and so many deaths.
"Live ammunition is not a tool to be used for crowd control in our view."
He added: "The Government will not be expelling the ambassador at this time. In fact in recent decades, if ever, Ireland has never expelled an ambassador. That is not the way we believe we should engage with other states.
"If we were to expel their ambassador they would expel ours."
Mr Varadkar said that would not help to solve the conflict as it would only result in shutting down dialogue.
The Irish embassy will remain in Tel Aviv, he said.
Sinn Fein's Pearse Doherty condemned the actions of Israeli forces in the Dail.
"What happened in Gaza yesterday was a massacre, there is no other way to describe it," Mr Doherty said.
"The actions of Israel are undermining efforts to secure a sustainable and peaceful two-state solution and must be urgently challenged by the international community. And without sanction and without adequate diplomatic response I fear more innocent civilians will be killed in the coming days."
Foreign Minister Simon Coveney held a meeting with the Israeli ambassador on Tuesday morning to discuss the conflict.
Mr Varadkar said the ambassador was told of Ireland's "outrage" and desire for an independent international investigation lead by the UN into the deaths.
A book of condolence will be opened on Wednesday at the Mansion House in Dublin to allow people to express their sympathies for those killed.