"We have been showing restraint due to the international outcry over the incident on the Gaza beach -- but no longer," he said during a tour in the north.
Peretz spoke minutes before an air strike in Gaza in which 9 Palestinians were killed when the air force targeted a van carrying Islamic Jihad terrorists on their way to fire rockets into Israel.
Peretz spoke during an exercise of the Home Front Command. Peretz also met with Northern Command chief Maj.-Gen. Yoav Galant and Southern Command chief Maj.-Gen. Udi Adam.
Peretz recently instructed the army to be vigilant while carrying air strikes in Gaza to avoid harming innocent civilians.
'Civilian casualties cannot be totally avoided'
At least five civilians were killed in Tuesday's strike, less than 12 hours ahead of the publication of the results of a military probe into the killing of seven members of the Ghalia family on a Gaza beach Friday afternoon.
"No evaluation will alter our commitment to defend the citizens of Israel. If the probe proves that it is was not an IDF shell we will launch a PR campaign," said Peretz when asked about the probe.
IAF Maj. Gen. Eliezer Shkedy said although the Air Force spares no effort to avoid harming civilians, civilian casualties cannot be totally avoided since terrorists operate from within populated areas.