However, Netanyahu added that if Tlaib submitted a request to visit family on humanitarian grounds, Israel would consider it as long as she promised not to promote a boycott against Israel.
The boycott movement aims to end worldwide support for Israel because of its policies toward Palestinians, as well as its continued construction of West Bank settlements, considered a violation of global law.
The decision was based, he said, on the "boycott activities" of the lawmakers.
"We were surprised today that they banned Rashida".
Israeli law blocks entrance visas to any foreigner who calls for any type of boycott that targets Israel - either economic, cultural or academic.
Several on the Right were, by contrast, supportive of Israel's decision to deny entry to people who want to undermine and weaken the country. There were no plans to meet officials, organizers said.
The two were also slated to visit the city's flash point holy site, called the Haram al-Sharif by Muslims and the Temple Mount by Jews.
She had been scheduled to arrive on Saturday in Israel, where she and Tlaib planned to tour the West Bank and visit the contested Al Aqsa Mosque in East Jerusalem.
Tlaib is from MI and Omar from Minnesota - both are outspoken critics of the USA president, who has a close relationship with Netanyahu.
While Tlaib and Omar have previously clashed with Democratic leadership, party leaders were quick to condemn Israel for banning them.
"I can't stand by and watch this attack on our freedom of speech and the right to boycott the racist policies of the government and the state of Israel".
Israel faces a snap election next month, following Netanyahu's failure to form a governing coalition after the country's April elections. Israel did not change its stance regarding Omar.
"It's all about the Benjamins baby", Ms Omar had tweeted in a reference to the USA $100 note, leading to allegations that she was using a negative stereotype for Jews.
Deri said he made the decision with the support of Netanyahu and other Israeli officials.
She was responding to a tweet in which Ocasio-Cortez implied that Israel was sexist or Islamophobic when it banned Reps.
Trump repeatedly assailed the lawmakers, saying at a White House event in mid-July about Omar: "Somebody that comes from Somalia, which is a failed government, a failed state, who left Somalia, who ultimately came here and now is a congresswoman, who's never happy".
This is about allowing US lawmakers into Israel on an official visit.
The Israeli government claims the movement could "delegitimize" the country.
On Wednesday, Mr Netanyahu held consultations with the country's foreign minister, interior minister, National Security Council chief and attorney general, according toHaaretz newspaper.
On Thursday, Israel said it would not allow Tlaib and Omar to enter the country this coming Sunday for a trip focused mainly on viewing the impact of recent US policies and aid cuts on the Palestinians. "The itinerary of the two Congresswomen reveals that the sole goal of their visit is to harm Israel and increase incitement against it".
At a joint press conference in Jerusalem on Sunday, the leaders of the two delegations stated that Israel should allow Tlaib and Omar to visit.
But on Friday morning, Tlaib tweeted that she would not be visiting her grandmother and family after all. "This would be a shameful, unprecedented move", Democratic presidential hopeful and US Senator Elizabeth Warren said on Twitter.
Halie Sofier, the executive director of the Jewish Democratic Council of America, argued that the decision is "counterproductive and plays into President Trump's goal of politicizing support for Israel".
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