Turkish Prime Minister Tayyip Erdogan received a hero's welcome on his return to Istanbul on Friday after accusing Israel of "knowing very well how to kill" during a heated debate at the World Economic Forum.

President Shimon Peres had launched a fiery defence of his country's offensive in Gaza over the past month, and with a raised voice and pointed finger, questioned what Erdogan would do if rockets were fired at Istanbul every night.

"When it comes to killing, you know very well how to kill," Erdogan, visibly angry, responded as he sat next to Peres at the debate, which also included United Nations Secretary General Ban Ki-Moon and Arab League chief Amr Moussa.

Turkey, a predominantly Muslim but secular country that historically has had good ties with Israel and the Arab world, played a role in helping broker an end to the Gaza offensive, particularly by lobbying the Islamist Hamas group to declare a ceasefire.

Thousands of people gathered at Istanbul's Ataturk airport to greet Erdogan when he returned from the gathering of business and political leaders, waving Turkish and Palestinian flags and chanting "Turkey is proud of you". "Our people would have expected the same reaction from any Turkish prime minister," he told a news conference at Ataturk airport on Friday morning after speaking to the crowd. "This was a matter of the esteem and prestige of my country. Hence, my reaction had to be clear. I could not have allowed anyone to poison the prestige and in particular the honour of my country," he said.

Erdogan said Turkey's reproaches were not against the Israeli people or Jews but against the Israeli administration.

Beyond the scenes at the airport, Turks gave a mixed reaction to Erdogan's walk-out. Former diplomats said it was likely to fuel tension between Israel and Turkey and might weaken Ankara's position as mediator in the Middle East.

Broadcaster CNN Turk said Hamas had praised Erdogan. "There has been a feeling among Arabs and those in the Middle East that someone needs to speak out in this way against Israel. Erdogan did this," Fuat Keyman, an international relations professor at Koc University, said on NTV broadcaster.

Peres had asked Erdogan directly at Davos: "What would you do if you were to have in Istanbul every night a hundred rockets?"

Erdogan had responded strongly to Peres's repeated question to the panel of what they would do in Israel's position. "President Peres you are older than me and your voice is very loud. The reason for you raising your voice is the psychology of guilt. I will not raise my voice that much, you should know that. When it comes to killing you know very well how to kill. I know very well how you hit and killed children on the beaches," he said during the panel discussion.

Turkish President Abdullah Gul said: "Nobody should expect the Prime Minister of Turkey to swallow a disrespectful act. He gave the necessary response," Gul said.

Peres said on Friday he hoped relations with Turkey would not be affected by the heated exchange and added he had spoken to Erdogan by telephone after the debate. "We don't want conflict with Turkey. We are in a conflict with the Palestinians," Peres told reporters in Davos.

Turkey has harshly criticised Israel over its Gaza offensive, in which Israeli forces killed more than 1,300 Palestinians. Israel lost 10 soldiers and 3 civilians.

Erdogan's rhetoric has shocked Israel, and has been interpreted by some as an attempt to increase his support ahead of local elections in March with an electorate deeply sympathetic to the Palestinians.

"Prime Minister Erdogan's tantrum at Davos throws gasoline on the fire of surging anti-Semitism," American Jewish Committee Executive Director David Harris said in a statement.