The Israeli cabinet on Sunday approved changes in a law that could block amnesty for Palestinians imprisoned for murdering Israelis.
The amendment, which needs to be approved by parliament before passing into law, would give the courts power to prevent Israel's president from granting clemency or shortening the jail term of anyone imprisoned for murder.
Ayelet Shaked of the far-right Jewish Home party who initiated the change said it was aimed at preventing the release of Palestinian militants who killed Israelis as well as other murderers.
"The mass release of terrorists through diplomatic deals makes a mockery of the Israeli public as does shortening the prison terms of criminal murderers," she said in a statement.
The latest round of US-led peace talks collapsed in April after Israel refused to release a fourth and last round of 26 long-term prisoners imprisoned for killing Israelis, breaching a commitment made in 2013.
Throughout the talks, Israel released 78 of the promised 104 prisoners, in a move which angered hardliners.
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Zehava Gal-On of the dovish Meretz party said the amendment would tie Israel's hands in future talks and accused Prime Minister Benjamin Netanyahu of "capitulating to the extreme right and supporting a demagogic law".
In 2011, Israeli soldier Gilad Shalit was freed from more than five years of captivity in Gaza in exchange for the release of 1,027 Palestinians.
In a separate development, the Israeli government is also seeking to push through legislation which would allow for the forced medical treatment, including feeding of Palestinian prisoners on hunger strike.
The bill, which must pass two more readings in parliament before becoming law, came as 285 Palestinian prisoners were observing a mass hunger strike in protest against their being held without charge under a procedure called administrative detention.
Of that number, 125 have been refusing food for more than six weeks, with 65 of them being treated in hospital, the Israeli Prisons Service said on Sunday.
In a mass show of solidarity, shops, businesses and restaurants went on strike in Ramallah and El Bireh, as well as in the northern West Bank town of Tulkarem on Sunday, AFP correspondents said.
UN chief Ban Ki-moon has urged Israel to either charge or release the striking prisoners without delay.
Some 5,000 Palestinians are being held in Israeli jails, nearly 200 of whom are being held in administrative detention.