Extremist vandals on Thursday torched another mosque in the latest "price tag" vengeance attack as Israeli troops demolished part of an illegal settlement outpost in the northern West Bank.

It was the second time in as many days that vandals had tried to burn down a mosque and left Hebrew-language graffiti at the scene in a protest linked to state plans to dismantle a handful of wildcat settler outposts.

The growing wave of extremist violence, which earlier this week was directed at Israeli troops, pushed Prime Minister Benjamin Netanyahu to announce on Wednesday new measures against Jewish "rioters" who attack the security forces.

Under the new regulations, the army will now have the authority to detain offenders, as well as the police, and they will be tried in military courts rather than in civilian courts.

The security forces will also be empowered to place offenders in administrative detention, in which a person can be held without charge for an unspecified length of time, and there will be an increase in orders barring individuals from specific areas of the West Bank.

"Those who raise a hand against Israeli soldiers or police will be punished severely," Netanyahu said.

But he stopped short of adopting a recommendation by his justice and internal security ministers to classify offenders as "terrorists."

Despite a flurry of "price tag" attacks against mosques and Palestinian property, debate in Israel was focused squarely on the violence against troops and at the Ephraim army base in the northern West Bank.

Thursday's arson attempt targeted a mosque in Burqa village near Ramallah.

"Carpets and chairs in the women's section were partly burnt and on the wall was Hebrew graffiti saying 'The war has started'," said Mayor Abdelkader Abdeljalil.

It was the second attempt to torch a mosque in as many days.

Early on Tuesday, a disused mosque in central Jerusalem was set alight and covered with racist anti-Arab graffiti in a move which drew a sharp condemnation from Washington.

No-one saw the perpetrators of the attack in Burqa but they were widely assumed to be Jewish extremists who often carry out acts of vandalism in response to attempts by the Israeli government to demolish wildcat settlement outposts.

Burqa is located less than a kilometre away from Migron, a settlement outpost which is slated for demolition within the next six months by virtue of an order from Israel's Supreme Court.

It was not clear whether the arson attack was connected to an overnight operation by Israeli troops who demolished two structures in another settlement outpost near the northern city of Nablus.

Troops and police demolished a house and a goat shed in Mitzpe Yitzhar said Guy Inbar, a spokesman for COGAT, the military unit responsible for civilian affairs in the West Bank.

"The operation in Mitzpe Yitzhar was in accordance with a Supreme Court order to remove these structures by the end of the year because they are built on private Palestinian land," he told AFP.

Settler activists have undertaken a campaign to prevent the demolition of such outposts but the overnight operation appeared to take them by surprise, with troops reportedly entering the area via a Palestinian village, then declaring the outpost a closed military zone.

Police said there were no reports of any disturbances.

Israel considers settlement outposts built without government approval to be illegal and often sends security personnel to demolish them. They usually consist of little more than a few trailers.

But the international community considers all settlements built in the West Bank, including east Jerusalem, to be illegal.