The company commander, whose identity was not revealed, shot 13-year-old Iman al-Hams as she was on her way to school in Rafah. A few minutes later he riddled her body and head with 15 to 20 bullets to make sure she was dead.
The practice, known as verification of killing, is used widely in the Israeli army after shootings of Palestinians.
Chief of Staff Lieutenant-General Moshe Yaalon on Friday concluded that the platoon commander acted properly and that no action should be taken against him.
In a briefing to the Israeli cabinet last week, Yaalon argued that the officer should be given the benefit of the doubt, saying he suspected she could have been used by Palestinian fighters to divert soldiers' attention and lure them from their positions.
However, soldiers serving under the officer's command gave damning evidence, suggesting he killed the girl in cold-blood before "emptying his entire magazine to her head".
"We saw her from a distance of 70m," one of the soldiers is quoted as saying.
Some say Israeli soldiers are
taught to kill young Palestinians
"She was fired at and shot from the outpost. She tried to flee but was wounded badly. I understand she was dead.
"The commander walked toward her, he shot her two additional bullets before returning to the outpost. Then he returned to the girl, put his weapon on the automatic mode and emptied his entire magazine."
"Our hearts ached for her - just a 13-year-old girl. How can anyone spray a girl from close range? The commander was hot for a long time to take out Arabs and shot the girl to relieve pressure."
The Israeli army radio, Gali Tzahal, on Thursday quoted another soldier as saying that the commander was "waiting impatiently to see an Arab pass by to kill him".
When the incident occurred nearly 10 days ago, an Israeli army spokesperson said the girl might have been carrying a bomb in her school bag, and that she had to be killed to rule out any risk to troops.
It was also said that she might have tried to lure out soldiers so Palestinian snipers could shoot them.
The Israeli army later said the girl entered a closed military zone and had to be killed.
Since the outbreak of the Palestinian uprising against the Israeli military occupation more than four years ago, the Israeli army and paramilitary Jewish settlers have killed an estimated 600 to 700 Palestinian children and minors.
Since the beginning of October alone, the Israeli army has killed at least 124 Palestinians in the Gaza Strip, the bulk of them civilians.
According to the Israeli human rights organisation B'tselem, up to 30 children were among the victims, including nine-year-old Ghadir Mukhaimar who was shot by an Israeli sniper last week while sitting in her class in Khan Yunis, south of Gaza City.
Relatives of Ghadir Mukhaimar
grieve at her funeral
Israeli army spokespeople normally explain child fatalities as happening in "crossfire" or "in vague circumstances".
However, Palestinian officials and human rights groups argue that the killing of Palestinian children and civilians is carried out "knowingly and deliberately".
"Do you think all these kids were killed by mistake?" said Muhammad Yusuf, head of the disaster management unit at the Palestinian Red Crescent Society in Gaza.
"The fact that a disproportionate number of Palestinian civilians are killed by the Israeli army in this unequal conflict shows there is a deliberate and conscious Israeli policy to kill civilians."
He told Aljazeera.net Israeli troops often fire artillery shells at crowded streets and neighbourhoods, aware that the shells will kill and maim children and civilians.
Asked why he thought the army would target civilians, he said: "Criminality toward the Palestinians is an old and intrinsic instinct in the overall Israeli mentality.
"Criminality toward the Palestinians is an old and intrinsic instinct in the overall Israeli mentality"
Muhammad Yusuf, disaster management head, Palestinian Red Crescent Society, Gaza
"They are taught to kill the Palestinians when they are very young. They are taught that another holocaust could happen if they don't destroy their enemies. That is why Israeli soldiers murder our kids without the slightest guilt."
And the Israeli media does little to deny that the army is occasionally light on the triggers.
Indeed, the newspaper Haaretz quoted a high-ranking officer earlier this month as saying: "Our troops will not be meticulous about the direction of their bullets."
Moreover, it is clear that the Israeli army views the killing of Palestinian civilians as an integral part of the losses Palestinians must incur as punishment for their uprising against occupation.
One Israeli soldier was quoted as saying on Thursday: "We have erected 100 mourning tents for them," alluding to the killings in Gaza during the past two weeks.