The Israeli Broadcasting Authority has banned a radio advertisement from a human rights organisation which listed the names of some of the scores of children killed in Gaza since the conflict began 17 days ago.

B'Tselem's appeal against the decision was rejected on Wednesday. It intends to petition Israel's supreme court on Sunday in an effort to get the ban overturned.

The IBA said the ad's content was "politically controversial". The broadcast refers to child deaths in Gaza and reads out some of the victims' names.

In its appeal, B'Tselem demanded to know what was controversial about the item. "Is it controversial that the children [aren't] alive? That they're children? That those are their names? These are facts that we wish to bring to the public's knowledge."

In a statement, the human rights group said: "So far more than 600 people have been killed in bombings in Gaza, more than 150 of them children. But apart from a brief report on the number of fatalities, the Israeli media refrains from covering them." By Thursday morning, the death toll in Gaza had exceeded 700.

B'Tselem went on: "IBA says broadcasting the children's names is politically controversial. But refusing to do so is in itself a far-reaching statement – it says the huge price being paid by civilians in Gaza, many of them children, must be censored."

Aid agencies said on Wednesday that a child had been killed in Gaza on average every hour for the preceding two days, and more than 70,000 children had been forced to flee their homes. There has also been a spike in the number of premature births.

"The shocking number of children being killed, injured, or displaced in Gaza demands an unequivocal international response to stop the bloodshed," Save the Children said. "Entire families are being wiped out in seconds as a result of the targeting of homes."

Dr Yousif al Swaiti, director of al-Awda hospital, said: "We have witnessed many premature births as a result of the fear and psychological disorders caused by the military offensive. The number of cases of premature births per day has doubled, compared to the average daily rate before the escalation."