The ministry last week said that Google, which owns YouTube, had agreed a joint mechanism to monitor online materials -- including videos encouraging attacks on Israelis -- after a meeting between Google executives and the Israeli Deputy Foreign Minister Tzipi Hotovely.
But the firm said no such agreement had been struck.
A Google spokesman told AFP the meeting, in which Hotovely met Google's senior counsel for public policy, Juniper Downs, and YouTube chief executive Susan Wojcicki, was just "one of many that we have with policymakers from different countries to explain our policies on controversial content, flagging and removals".
Foreign ministry spokesperson Emmanuel Nahshon confirmed a statement on their website had been changed but said Israel was still "extremely grateful for the good relations with Google".
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"Our common objective is to remove dangerous incitement to violence on social media. We have full confidence in the Google teams dealing with this removal."
Israel has been hit by a wave of stabbing, shooting and car ramming attacks by Palestinians since October 1, with 17 Israelis killed.
The Israeli government has repeatedly pointed to online incitement as a cause for the attacks, with videos and posts lionising the assailants being widely shared.
Prime Minister Benjamin Netanyahu has called on Google, Facebook and Twitter to do more to monitor and remove such material.
The Internet firms have defended their policies, saying they have sufficient protection against online incitement and rejecting perceptions of political interference.
"We rely on the YouTube Community to flag videos that they think violate our Community Guidelines," the spokesperson for Google said.