Hundreds of police ringed the apartment building around midday on Wednesday. Settler leaders said about 70 people moved into the building last week. But only 15 or so, including children, were inside when the raid was launched, police spokesman Micky Rosenfeld said.
He said an eviction order was ripped up by one of the people inside, but otherwise there was no resistance.
Defense Minister Ehud Barak, who oversees the military occupation of the West Bank, promised to "continue to act to uphold the law and democracy while safeguarding the state's authority over its citizens."
Authorities were still investigating whether the house was legally purchased as the settlers claim, Barak said.
Barak heads a small, centrist faction in a government coalition that is otherwise dominated by hard-line parties sympathetic to Jewish settlers, who are intent on cementing Israel's control over the West Bank.
Hebron settlers are among the most militant in the West Bank, territory they believe God promised to Jews.
After Wednesday's raid, one of the most militant settler leaders, Baruch Marzel, warned of retaliatory attacks.
"No one wants more violence," Marzel said, but added that "when the racist government that doesn't let the Jews buy a house in the land of Israel ... I think violence is a reaction to the racist government."
The raid came shortly after Netanyahu announced new moves to try to save unauthorized settler construction in the West Bank from demolition.