Al Jazeera said it "denounces such arbitrary accusations and hostile statements."
The broadcaster went on to characterize Netanyahu's claims as "yet another episode of the ongoing vicious attack" against it.
"Al Jazeera stresses that it would take all necessary legal measures in case they act on their threat. The network moreover reiterates that it will continue covering the news and events of the occupied Palestinian territories, and elsewhere, both professionally and objectively," Al Jazeera said.
Earlier on Thursday, Israel reportedly removed all the remaining barriers at the entrance to the Old City and the Temple Mount in a bid to ease the tensions and violence.