A senior Israeli official says he led a secret parliamentary investigation into the family of a Palestinian girl who has become a protest icon and who is being held for slapping Israeli soldiers, questioning whether they were a "real" Palestinian family because of their Western appearance.

The stunning comments by lawmaker Michael Oren are the latest twist in a case that has turned into a public relations headache for Israel.

Oren, a deputy minister, said on Wednesday that Ahed Tamimi's family was examined partly because of their appearance, including "blond-haired, freckled" children in "Western clothes."

He says his probe, held two years ago, concluded that "someone" was paying for children to scuffle with soldiers to tarnish Israel's image abroad.

Following the remarks, Tamimi's father accused Oren of racism.