El AL Airlines said Thursday it is investigating the incident but decided to "honor those tickets that where purchased and ticketed" regardless.
The mistake drastically lowered round-trip airfare between New York and Israel on El Al Airlines and created a run on tickets for a three-hour period.
At least 5,000 tickets were purchased Monday after El Al posted fares for less than $400, down from an average of $1,600.
The New York Post says news of the bargain fare quickly spread through New York's Orthodox Jewish communities after a website sent out an alert.
El Al blames the mistake on a contractor responsible for posting fares.