"The replanning of these sections will be based on the principles set by the High Court, namely the proper balance between security and humanitarian considerations," the Defence Ministry said in a statement.
In a landmark ruling, the High Court on Wednesday said: "The state must find an alternative that may give less security but would harm the local population less".
The move by the three-judge panel ruling came ahead of an expected 9 July decision by the International Court of Justice, which was asked by the United Nations to examine the legality of the network of fences and walls.
Palestinians say barrier Israeli
ploy to annex their land
"This route has created such hardship for the local population that the state must find an alternative that may give less security but would harm the local population less. These alternative routes do exist," the High Court said.
Its ruling could set a precedent for more than 20 other Palestinian petitions against segments of the barrier that runs some 190km (118 miles) and is to extend for hundreds more.
Israel says the barrier aims to keep out Palestinian human bombers who have infiltrated from the West Bank into Israeli cities and killed hundreds of Israelis in a string of attacks.
Palestinians call it a disguised bid to annex occupied territory they want for a future state since it often snakes well inside the West Bank to take in Jewish settlements.
The case addressed by the court was filed by a string of Palestinian villages northwest of Jerusalem. In a first for such cases, they were joined by 30 residents of a nearby Israeli boundary town.
They protested at the Israeli Defence Ministry's plan for a looping stretch of barrier that would cut many villagers off from their olive and citrus groves, from neighbouring villages and from larger West Bank towns serving the rural region.
"This is a courageous
and very important decision. Of course it
"This is a courageous and very important decision. Of course it is precedent-setting," Muhammad Dahlih, the lawyer for the petitioning villages, told reporters at the court.
"This decision is more important than the one at The Hague because this one will be followed.
"It says what we said from the beginning, that the building of the wall as it is being built is illegal and that there is another way to build it that will give security to Israel but won't violate Palestinian rights."
Israel's government argued that the barrier segment had to be built further into the West Bank rather than along the boundary to provide a security buffer.