Later in the day, Israeli ambassador Isaac Bachman was called home.
"This indeed reflects our irritation and annoyance at this unhelpful decision, which does not contribute to a return to (peace) negotiations," Israeli foreign ministry spokesman Emmanuel Nachshon told the AFP news agency.
Israeli ambassador Isaac Bachman has left Stockholm. Photo: TT
"We knew that Israel would be critical when we made this decision. I respect that criticism, even though I don't share it," Margot Wallström told The Local.
"It can happen that ambassadors are called home for consultations - that's part of diplomatic business."
"I'm convinced that we have mutual interests to uphold and strengthen our good bilateral relations."
Thursday's announcement meant that Sweden became the first EU member in western Europe to recognize Palestine as a state.
Israel's top diplomat described the decision as "deplorable".
"The Swedish government must understand that relations in the Middle East are a lot more complex than the self-assembly furniture of IKEA and that they have to act with responsibility and sensitivity," Foreign Minister Avigdor Lieberman said in a statement.
Margot Wallström is Sweden's new Foreign Minister. Photo: TT
Responding to the comments in an interview with CNN, Wallström replied:
"I think it’s a sign of a sense of humor, and I will be happy to send him a flat pack of IKEA furniture and he will also see that what you need to put that together is, first of all, a partner.”
“You also need to cooperate and you need a good manual. I think we have most of those elements if we want to use them also for the conflict in the Middle East. For peace you need two parties to actually sit down at the same table and discuss the future,” she added.
She told The Local that she and Israel's Foreign Minister had talked about meeting one another and that she was looking forward to their discussion.