The attack is one of the deadliest of the nearly three-month-long war.
The ministry’s spokesman, Ashraf al-Qudra, late on Sunday said the toll is likely to rise.
“What is happening at the al-Maghazi camp is a massacre that is being committed on a crowded residential square,” he said.
Dozens more are reported to be injured and several houses have been destroyed in the attack as families dig through the rubble in an attempt to find survivors.
“We were all targeted,” said Ahmad Turokmani, who lost several family members including his daughter and grandson. “There is no safe place in Gaza anyway.”
Al Jazeera’s Tareq Abu Azzoum, reporting from Rafah in southern Gaza, said the al-Magahzi refugee camp is one of the most densely-populated areas in the middle of the Gaza Strip.
He said it was one of the places the Israeli military had previously told the Palestinians in Gaza to evacuate to. Now the camp has been “completely flattened”, he said.
“The vast majority of the casualties right now have been among civilians, including [a] two weeks [old] baby that has been killed in cold blood in this genocide,” said Azzoum.
He compared the attack with one on the Jabalia refugee camp in northern Gaza last week, in which at least 90 people were killed.
The al-Maghazi camp was attacked last month as well when at least 50 Palestinians were killed.
Azzoum said the camp’s surrounding areas had been subjected to intense Israeli shelling in the last couple of days.
The nearest hospital to the camp is the Al-Aqsa Hospital but health facilities have been rendered non-functional across Gaza as Israel continues to bombard the territory for a third month, killing more than 20,400 Palestinians since October 7 and displacing more than 80 percent of the 2.3 million people who live there.
“The entire medical care system in Gaza Strip is deteriorating and [is] on the edge of collapse,” said Azzoum.
Hamas called the air attack on the al-Maghazi camp “a horrific massacre” and said it was “a new war crime”.
Israel’s military spokesperson’s office said it was looking into reports of the attack.