The UN General Assembly said on Tuesday that it was set to hold an emergency session on Thursday to discuss the crisis after a previous session was postponed last week ahead of a UN Security Council vote on the issue.
The Security Council adopted a resolution calling for a ceasefire in Gaza, but Israel has escalated its offensive and Palestinian rocket fire has also continued.
"There have been some who were under the illusion that the Security Council would do something that could help the situation," d'Escoto said. "I never thought so.
"Now we're faced with not only with a lack of compliance but with a prime minister of Israel who has practically responded to the Security Council by saying 'mind your own business'.
"It's unbelievable that a country that owes its existence to a general assembly resolution could be so disdainful of the resolutions that emanate from the UN."
D'Escoto, a former Roman Catholic priest and Nicaragua foreign minister, is known for his outspoken criticism of Israel and last year likened Israel's treatment of the Palestinians to the racist apartheid system previously used in South Africa.
Gabriela Shalev, Israel's ambassador to the UN, called d'Escoto an "Israel hater" for having hugged Mahmoud Ahmadinejad, the Iranian president and a vocal critic of Israel.
D'Escoto also said the UN had to bear some responsibility for the long-standing conflict in the Middle East as it had allowed the creation of the state of Israel in 1948, leaving the Palestinians stateless.
"You have to attack problems at their root cause and the Palestinian people have been subjected to subhuman treatment for decades and this [the Israeli offensive] is going to make matters worse."