"Yesterday. a violent riot was instigated in the area of the Erez crossing, with the participation of hundreds of Palestinian rioters," the army said in a statement.
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"Subsequently, it was decided to close the Erez crossing until the damage caused by the rioters will be repaired."
The Palestinians were protesting against an announcement by Washington on Friday that it would cease all funding to the United Nations Relief and Works Agency for Palestine refugees (UNRWA) which helps some three million needy refugees.
The army said the Palestinians had damaged the infrastructure of the crossing on the Gaza side with rocks.
It said the crossing would remain open for "individually approved humanitarian cases".
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Israel reopened Erez on August 27 after an 11-day closure following previous clashes, as part of its policy of easing its decade-long air, land and sea blockade on the Gaza Strip when calm is maintained. The sole goods crossing between Israel and Gaza, Kerem Shalom, remains open.
There have been months of tension along the border and several military-flare ups, but recent weeks have seen relative calm.
Egyptian and United Nations officials have been mediating indirect negotiations on a long-term truce between Israel and Gaza's Islamist rulers Hamas, who have fought three wars since 2008.
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