Saber Rebai, a performer known throughout the Arab world and a judge on the Arabic version of "The Voice", said he was unaware the soldier was Israeli and rejected any acceptance of the Jewish state.
The controversy broke out when the Israeli military body responsible for the country's policies in the occupied Palestinian territories, known as COGAT, posted a photograph on social media of a smiling Rebai posing beside an Arab Israeli soldier, identified as Hadi Khatib.
The photograph was taken as Rebai was crossing from Jordan into the occupied territories ahead of a Friday gig in the Palestinian city of Rawabi.
COGAT captioned the picture saying it was "happy promoting concerts".
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The post was later deleted, but the image was widely shared on Palestinian social media, with one Gazan telling Rebai: "Shame on you".
In a statement released on Facebook on Monday, Rebai said he was unaware Khatib was in the Israeli army.
"He introduced himself in Arabic as Hadi and said he was responsible for facilitating the crossing... so there was no communication with any Israeli," the statement said.
Khatib asked for the photograph to be taken, the statement said, adding that Rebai had long been a "supporter of the Palestinian cause and rejected normalisation with the Israeli enemy."
The populations of many Arab and Muslim countries, even those that have formal relations with Israel, often reject any dealings with Israelis, seeing it as acceptance of the treatment of the Palestinians.
At this month's Olympics in Rio, Egyptian judo competitor Islam El Shehab refused to shake the hand of his Israeli opponent after losing a bout.