The Balfour residence had become a symbol of the Netanyahus' scandals, and was the scene of weekly protests against Netanyahu for much of the past year.
The planned march in east Jerusalem has posed a test for the fragile new government as well as the tenuous truce that ended last month's 11-day war between Israel and Hamas.
Al Jazeera reporter forcefully detained by Israeli border police while reporting from embattled Jerusalem neighborhood
Givara Budeiri suffered a broken arm and remained under observation Sunday at Jerusalem's Hadassah Hospital, said Walid Omary, the Jerusalem bureau chief for Al Jazeera.
Israeli police spokesman Micky Rosenfeld said the site was open for "regular visits" and that police had secured the area to prevent "incidents," without elaborating.
Israeli drones fired a series of warning shots at the roof to give people time to leave the building before it was destroyed by the military.
Police fired tear gas and stun grenade canisters some of them landing in the Al-Aqsa Mosqe, Islam's third holiest site.
The march was approved amid ongoing clashes between police and Palestinians in the Old City, the emotional epicenter of the long-running conflict.
UAE foreign ministry called on Israeli authorities to “assume responsibility toward de-escalation and putting an end to all aggressions and practices that perpetuate tension and hostility.”
Netanyahu is charged with fraud, breach of trust, and accepting bribes in three cases involving billionaire associates and media moguls, charges that he denies.
It came a day after the United States transferred its Israel embassy from Tel Aviv to the disputed city of Jerusalem in a move that infuriated the Palestinians and was widely condemned.
It said there were 211 recorded attacks against health workers in Gaza and 25 ambulances had been damaged.
The UN rights office said Tuesday it seemed any Palestinian protesting in Gaza, regardless of whether or not they posed an imminent threat, was "liable" to be killed by Israeli forces.
Jerusalem is one of the most thorny issues of the Israeli-Palestinian conflict, with both sides claiming it as their capital.
The U.N. Security Council planned to meet Tuesday to discuss the violence, though it was not clear what might come out of the session.
The US came to the defence of its ally Monday, blaming Hamas for the violence and blocking a resolution at the UN calling for an international investigation.