Ms Merkel and a number of her ministers are scheduled to arrive on Wednesday evening for yearly meetings with Israeli prime minister Benjamin Netanyahu and his cabinet.
During the short trip she is expected to visit the Yad Vashem Holocaust Memorial and Museum in Jerusalem and receive an honorary doctorate degree from the University of Haifa.
Later on Thursday the German leader will meet for a working lunch with President Reuven Rivlin followed by closed door talks with Mr Netanyahu.
But overshadowing the visit is the expected demolition of Khan al-Ahmar, a Palestinian village located between two Israeli settlements of Kfar Adumim and Ma'ale Adumim.
The Israeli authorities gave the tiny hamlet, home to some 180 people, until 1 October to demolish their homes themselves. The deadline has passed, prompting concerns the demolition would happen during Ms Merkel’s visit.
The expected destruction of the encampment has sparked international uproar and demands for Israel to cancel the plan, which the United Nations has termed a “grave breach of international law”.
The UK, Germany, France, Italy and Spain issued a joint statement last month saying it could threaten the prospect of a contiguous Palestinian state, at a time when the peace process has stalled.
On Tuesday Palestinian children in Khan al-Ahmar staged a protest urging Ms Merkel to save their homes and their school.
Ms Merkel is not scheduled to meet any Palestinian leaders but is due to hold meetings with Mr Netanyahu and his government.
A spokeswoman for the German embassy in Tel Aviv told The Times of Israel that “a cancellation was not considered at any point in time”.
However, Israeli ministers responded angrily to the reports.
“If this is true, it’s a blatant, serious, and dangerous intervention,” Economy and industry minister Eli Cohen said.
“Israel is a sovereign state with a strong and independent court, and we’ve long since ceased to be a tool to salve the conscience of the Europeans,” he added.
An Israeli court ruled in September that the Bedouin tribe, who were originally displaced from the Negev Desert in the 1950s, had illegally built their homes in an unsafe location near a main road.
Israel has defended the decision, saying that the village did not secure the correct permits and so will be relocated to a more suitable location. According to Amnesty International, the two chosen options are beside a former Jerusalem municipal garbage dump, or in the vicinity of a sewage plant close to the city of Jericho.
Critics have condemned the decision, saying it is impossible for Palestinians to obtain the building permits in the Israeli-controlled areas of the West Bank known as Area C.
United Nations officials believe the village is being cleared to make way for the expansion of nearby Israeli settlements, illegal under international law.
Residents have repeatedly appealed the court decision.
Abu Anas, who was born in Khan al-Ahmar told The Independent they would remain on the land even if bulldozers arrive to destroy their houses.
“We will stay here and resist if they come here, even if it means sleeping outside,” said Abu Anas.
Join our new commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies