The cemetery was vandalised on Sunday evening by a group of about ten Palestinians, several of them carrying Kalashnikov assault rifles, according to caretakers at the site in Gaza City.
Some 33 tombstones were broken having been kicked apart by the vandals, the caretakers said.
The graves included several belonging to soldiers from the Royal Scots Fusiliers who died in the 1917 campaign that eventually led to the establishment of the British mandate in Palestine. It was the first ever incidence of vandalism at the cemetery, an island of greenery in drab Gaza City.
According to the Commonwealth War Graves Commission, the cemetery contains 3,217 Commonwealth burials from the First World War, 781 of them unidentified.
There are a further 210 Second World War graves there. The vandals targeted another 25 headstones, covering some with copies of the graphic photographs that have emerged showing abuse of prisoners in Baghdad’s Abu Ghraib jail, and defacing others with swastikas.
The attackers had written "USA equals UK" and "curse will chase you for ever" on the pictures. Ibrahim Jaradeh, MBE, the veteran caretaker of the cemetery, said: "I came quickly but these people escaped.
"What they have done is against our religion. Many of those tombs here are known only to God. Only people who have no heart can do this."
The vandals "did not say anything but the pictures explain why they did this", he added. Palestinian Authority minister of local government Jamal Shobaki said: "We condemn this action because it is against our culture and religion. Islam calls on us to respect the dead."
Mr Shobaki added that the Palestinian public has been angered by the photos of the abuse in Iraq.
"I myself spent time in an Israeli jail. We feel for the prisoners and are very angry. These pictures from Iraq are an inhuman sight. It is clear that they don’t view the Iraqis as human. Every Arab feels this personally."
British embassy officials yesterday said the desecration of the graves was "deplorable" and said they had asked the Palestinian authority to investigate the matter and bring the perpetrators to justice.
British troops, joined by soldiers from Australia and New Zealand, fought three battles against Turkish troops in the Gaza Strip during the First World War. They finally broke the Turkish line in 1917 under the command of General Sir Edmund Allenby in the third battle of Gaza and marched on to capture Jerusalem.
Many of the broken tombstones belonged to unknown soldiers. They were adorned with crosses and said simply "a soldier of the Great War known unto God".