Egeland cited Lebanese health ministry figures saying that more than 600 people had been killed since Israel launched its offensive on July 12 following Hezbollah's capture of two soldiers in a deadly cross-border raid.
He said at least one third of the casualties were children.
"There is something fundamentally wrong with a war where there are more dead children than armed men. That has to stop," he said.
Israel has ordered the mobilization of thousands of army reservists to bolster its assault and decided to step up its air war.
The government said it plans to create a narrow buffer zone in Lebanon until the mooted international force is deployed, but will restrict ground offensives and has no plans to reoccupy its northern neighbor.
Israel had seized on the failure of an international conference in Rome last week to call for a quick truce as a green light to press on with its offensive.
But that claim was dismissed on Friday as "outrageous" by Washington, in its strongest open criticism of Israel yet.
With no sign of a let-up in violence, Hezbollah militants gave a new display of their firepower on Friday. The rebels launched a new "Khaibar I" missile that Israel said was capable of carrying 100kg of explosives.
Hezbollah leader Hassan Nasrallah, who declared "open war" on Israel after his home and headquarters were destroyed, warned that his guerrillas would fire missiles beyond the northern port city of Haifa, which has faced a barrage of deadly rocket fire since the conflict began.
The Israeli military said it would deploy Patriot anti-missile batteries near the capital Tel Aviv if Hezbollah were to use long-range missiles.
Army chief Dan Halutz on Thursday claimed that "enormous" damage had been inflicted on Hezbollah.
With 800,000 people displaced by the fighting, the International Committee of the Red Cross criticized the "unacceptable" humanitarian situation in Lebanon and said Israel had to do much more to spare civilians.
International medical charity Medecins Sans Frontieres said Israel's promised aid corridors were an illusion.
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