He made his remarks on a visit to the first Israeli university to be established in a settlement in the occupied territories, in sprawling Ariel in the West Bank.
"The danger to the world is not a university in Ariel. The danger to the world is not that Israel is building neighbourhoods in Jerusalem," he said, ahead of a January 22 general election and after a drive to approve thousands of new Israeli homes in annexed east Jerusalem.
"The danger is Iran, which is building nuclear weapons. The danger is Syria's arsenal of chemical weapons," he said, according to a transcript of his comments.
"History will judge harshly those who equate democratic Israel -- which is establishing a university -- and dictatorial regimes that slaughter their people and which hold atomic weapons of mass destruction," he said, vowing to continue construction "in our land."
Located deep in the northern West Bank, Ariel has a population of 17,800 and is one of the largest Jewish settlements in the occupied territories.
Two weeks ago, Defence Minister Ehud Barak confirmed a government decision to upgrade the settlement's higher education college, which was set up in 1982, approving its status as a university.
The Ariel University Centre currently has 12,000 students spread across four faculties -- medicine, engineering, natural sciences and social sciences -- and also has facilities for architecture and telecommunications studies.
Full recognition as a university entitles it to significant additional funding and allows it to give out advanced degrees.