Elkin, the country's immigration minister and a member of Prime Minister Benjamin Netanyahu's security cabinet, said ministers were not notified of such an initiative.
The Haaretz daily said that according to "senior Israeli officials familiar with the contacts", Israel and the Palestinian Authority have being holding secret negotiations over the past month for a gradual restoration of Palestinian security control over West Bank cities.
"During the talks, Israel proposed that Ramallah and Jericho be the first cities the (Israeli military) would withdraw from; if the measure succeeded, it would be expanded to other West Bank cities," it reported tonight.
Netanyahu's office did not immediately respond to AFP's request for comment.
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"We members of the security cabinet didn't know about this and I personally oppose this idea totally," Elkin, of Netanyahu's Likud party, told Israeli public radio.
Under peace agreements Israel handed control of main West Bank cities to the Palestinians in 1996, but in 2002's "Operation Defensive Shield" it retook them following a deadly suicide bombing in the Israeli coastal resort of Netanya.
Since then Israel forces regularly enter at will.
Ramallah and the main Palestinian cities are in the zone, known as "Area A', designated under the Oslo peace accords as under full Palestinian rule.
Some 60 per cent of the West Bank is under full Israeli control.
Haaretz said that under Israel's proposal its forces would reserve the right to enter Area A to counter imminent threats of militant attack, known in security circles as "ticking bomb" scenarios.
It said the Palestinians rejected the demand as contrary to the Oslo treaties.
"In Area A about 80 per cent of the work which ensures the security of the state of Israel is done by the (Israeli) army and security forces," he said.
"In the midst of the terror wave enveloping us, to pass responsibility to the Palestinians seems to me a very, very problematic idea."
Since October 1, a wave of violence has killed 193 Palestinians, 28 Israelis, two Americans, an Eritrean and a Sudanese, according to an AFP count.
Most of the Palestinians were killed while carrying out knife, gun or car-ramming attacks.