The newspaper Jyllands-Posten had not intended to insult Muslims when it published the drawings, Anders Fogh Rasmussen, the Danish prime minister said on Sunday, referring to an editorial on the paper's website in Danish and Arabic.
But while Rasmussen tried to assuage Muslim anger, Libya on Sunday closed its embassy in Denmark in protest at the drawings.
Earlier this week, Saudi Arabia recalled its ambassador from Denmark and Saudi religious leaders have urged a boycott of Danish products.
"Because the Danish media had continued to show disrespect to the Prophet Mohammed and because the Danish authorities failed to take any responsible action on that, Libya decided to close its embassy in Copenhagen," the Libyan Foreign Ministry said in a statement.
Libya also threatened to take unspecified "economic measures" against Denmark.
Islam considers images of prophets disrespectful and caricatures of them blasphemous.
Since Jyllands-Posten published the drawings in September, the Danish government has repeatedly defended the right of free speech.
"The government can in no way could influence the media. And the Danish government and the Danish nation as such cannot be held responsible for what is published in independent media," Fogh Rasmussen said.
Kuwaitis have protested outside
the Danish embassy
The newspaper has not apologised for publishing the drawings, which have caused widespread anger among Muslims around the world.
In a demonstration on the West Bank, members of Fatah's al-Aqsa Martyrs Brigades threatened Danes in the area and told them to leave immediately, the Danish news agency Ritzau reported on Sunday.
The demonstrators burned the Danish flag and called on the Palestinian authorities to cut diplomatic ties with Denmark, Ritzau said.
"We are sorry the matter has reached these proportions and repeat that we had no intention to offend anyone, and that we as the rest of the Danish society respect freedom of religion," the newspaper's editor-in-chief Carsten Juste said in the editorial.
Fogh Rasmussen was speaking at a joint news conference with Hamid Karzai, the visiting Afghan president, who said he was satisfied with the newspaper's explanation and the Danish government's view.
"Prime Minister Rasmussen explained Denmark's position on that (the drawings), which was very satisfactory to me as a Muslim," Karzai said.
The Danish government has broad "public backing for it stance on the cartoons. An opinion poll showed that 79% of Danes think Fogh Rasmussen should not issue an apology and 62% say the newspaper should not apologise.
Prime Minister Rasmussen explained Denmark's position on that (the drawings), which was very satisfactory to me as a Muslim"
Earlier on Sunday, Ekmeleddin Ihsanoglu, secretary-general of Organisation of the Islamic Conference, said in Cairo the international body would "ask the UN general assembly to pass a resolution banning attacks on religious beliefs".
The deputy secretary-general of the Arab League, Ahmed Ben Helli, confirmed that contacts were under way for such a proposal to be made to the UN.
"Consultations are currently taking place at the highest level between Arab countries and the OIC to ask the UN to adopt a binding resolution banning contempt of religious beliefs and providing for sanctions to be imposed on contravening countries or institutions," he said.
Muslim wrath has spread rapidly in the Middle East, with Gulf retailers pulling Danish products off their shelves and protesters gathering outside Danish embassies.
Meanwhile, a Qatari cooperative society, Al Meera, has decided to boycott Danish and Norwegian products.
The move follows similar action taken by other Gulf countries such as Saudi Arabia and Kuwait in protest at the cartoons.
The offensive cartoons depicted
On the other hand, EU trade chief Peter Mandelson met a Saudi minister at a meeting in the Swiss mountain resort of Davos on Sunday and "urged the minister to convey the seriousness of this issue to his government", his spokesman said.
"Any boycott of Danish goods would be seen as a boycott of European goods," said spokesman Peter Power.
Saudi Arabia has denounced the cartoons and has recalled its ambassador from Denmark for consultations.Danish-based food company Arla said on Friday it would advertise in Saudi newspapers to distance itself from the row after facing a consumer boycott there.
Mette Schouby, a spokeswoman, said: "The advertisements will be published in leading national newspapers."
Saudi Arabia accounts for two-thirds of Arla's sales in the Middle East that total $396 million.
On Saturday, Kuwait's state-supported supermarkets announced a boycott of Danish products, and the Kuwaiti Foreign Ministry called in a regional Danish ambassador to protest against the caricatures while hundreds of Kuwaitis protested outside the Danish consulate.
Members of parliament in Bahrain are also calling for a boycott of Danish and Norwegian products.
Danish dairy products were set ablaze on Friday in Bahrain and the anger over the caricatures was also evident in the numerous mobile text messages urging the boycott, according to regional newspapers.
"The Danish government and the Danish nation as such cannot be held responsible for what is published in independent media"
Anders Fogh Rasmussen,
MP Shaikh Mohammed Khalid Mohammed urged people to stop buying Danish and Norwegian products until both countries apologise.
"So what if businesses in Bahrain will be affected, Islam is far more important than anything," he is quoted as saying.
In the emirate of Dubai, a scholar said all Muslim governments should recall their ambassadors from Denmark and boycott its products.
"Those are provocative cartoons that come from sick-minded and irresponsible people,' said the scholar, Ahmad Abd al-Aziz al-Haddad, quoted in the Gulf News.
Syria on Sunday also joined the chorus of condemnation.
"Syria strongly condemns this insult against the supreme token of the Arab and Islamic nations," the Syrian news agency Sana quoted an unidentified Foreign Ministry official as saying.
The official said the Danish government should punish the offenders.