Speaking to media persons, he said, "I decided to close Israel's southern border to infiltrators and terrorists. This is a strategic decision to ensure the Jewish and democratic character of the state of Israel."
The barrier will include both a fence and technological measures such as radars, the Prime Ministers' office officials confirmed.
The fence will be built along the border between Egypt and the Gaza Strip as well as in the area of the southern Israeli city of Eilat.
According to Israeli police, about 100-200 labour immigrants, refugees and criminals cross illegally into Israel through the border with Egypt each week.