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By Yolande Knell
BBC News, Jerusalem
The EU has cancelled its diplomatic event for Europe Day in Israel because of the planned participation of the far-right minister, Itamar Ben-Gvir.
Organisers said they did not want "to offer a platform" to someone whose views contradicted its values.
As the Israeli government's designated representative, Mr Ben-Gvir had insisted he would give the customary speech at a ceremony on Tuesday.
In response to the decision, he accused the EU of "undiplomatic gagging".
It is understood that the Israeli Government Secretariat put forward Mr Ben-Gvir's name according to a rotating list of ministers selected to attend official diplomatic events and that EU ambassadors were caught by surprise.
Despite explicit requests from the EU and its prominent member states to send a minister who was not identified with the extreme right, Mr Ben-Gvir insisted that he would go.
The national security minister had stated that he would use his speech to call for a united "struggle against jihad and terrorism" while also telling EU representatives it was "inappropriate for EU countries to fund initiatives against IDF [Israel Defense Forces] soldiers and Israeli citizens".
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Several EU representatives had threatened not to attend.
The decision to cancel the diplomatic ceremony was made after a meeting of EU ambassadors to Israel. Israeli media report that only Hungary and Poland, two conservative, pro-Israel countries, dissented.
In its short statement, the EU delegation to Israel said it would continue to celebrate Europe Day on Tuesday, as it does annually.
It said that a cultural event for the general public scheduled to take place in Tel Aviv would go ahead "to celebrate with our friends and partners in Israel the strong and constructive bilateral relationship".
The response from Mr Ben-Gvir's office criticised the EU, saying it was "a shame" that the international body "which claims to represent the values of democracy and multiculturalism, practises undiplomatic gagging."
"It is an honour and privilege for me to represent the Israeli government, the heroic IDF soldiers, and the people of Israel in every forum," he added.
Since Israel swore in its most hard-line government ever at the end of last year, official representatives of many European countries - which have strong relations with Israel - have refused to meet Mr Ben-Gvir and his fellow ultranationalist, Finance Minister Bezalel Smotrich.
The controversy around Europe Day has been a source of diplomatic embarrassment.
Adding to the sensitive timing, the EU harshly condemned Israel's demolition on Sunday of an EU-funded elementary school for Palestinian children near Bethlehem in the occupied West Bank.
The Israeli military said the structure - in part of the West Bank under full Israeli control - was built illegally and was unsafe, leading to an Israeli court decision to demolish it.
On its Twitter account, the EU delegation to the Palestinians said it was "appalled" by the action, which it said would affect 60 children, and that the demolition was illegal under international law.
Palestinians often justify what Israel deems as illegal building in the West Bank by saying it is virtually impossible to obtain official construction permits.