Military spokesman Rear Admiral Daniel Hagari said Benjamin's body was recovered in the same operation that saw troops retrieve the remains of three other hostages, which was announced on Friday.
Benjamin was "murdered during the October 7th massacre at the Mefalsim intersection, and his body was abducted to Gaza by Hamas militants", the military said in a separate statement.
"His body was rescued along with the bodies of Yitzhak Gelerenter, Shani Louk, and Amit Buskila ... based on precise intelligence obtained during the interrogations of terrorists who were apprehended in the Gaza Strip."
The military said on Friday troops had recovered the bodies of Louk, Buskila and Gelerenter from Gaza after they were taken hostage during the attack on the Nova music festival.
Thousands of young people had gathered on October 6 and 7 to dance to electronic music at the event held near Re'im kibbutz close to the Gaza border.
Fighters from Hamas crossed over from Gaza and killed more than 360 people at the festival, Israeli officials have said.
The Nova festival victims accounted for nearly a third of the more than 1,170 people killed in the October 7 attack, most of them civilians, according to an AFP tally based on Israeli figures.
Out of the 252 people taken hostage that day, 124 are still being held inside the Gaza Strip, including 37 the army says are dead.
Israel's retaliatory offensive against Hamas has killed at least 35,386 people in Gaza, mostly civilians, according to data provided by the Hamas-run territory's health ministry.
'Hostages returning in body bags'
On Saturday, campaign group The Hostages and Missing Families Forum called on the Israeli authorities to strike a deal with Hamas to bring back the remaining hostages.
"Those alive should be returned for rehabilitation, and those murdered should be brought back for a dignified burial, as was made possible for Ron Benjamin this evening," the group said in a statement.
Later Saturday, thousands of protesters rallied in Tel Aviv calling on the authorities to bring the remaining hostages back home.
The rally was also attended by US ambassador to Israel Jack Lew and some other international envoys.
The protesters included relatives of several hostages still being held, an AFP correspondent reported.
"As days go, we see more and more hostages are returning in body bags and more soldiers are being killed in Gaza," said Yotam Cohen, whose brother Nimrod is captive in Gaza.
"We want to stop the bloodshed."
Zahiro Shahar Mor, nephew of hostage Avraham Munder, said: "This war should not have started. This war is a war of revenge.
"It is endangering not only the people of Gaza but also the hostages."
Addressing the rally, Lew reiterated Washington's commitment to help secure the hostages' release.
"We will not stop working until you are reunited with your loved ones. The United States continues to press ahead mediation efforts to bring the hostages home," he said.
"Hamas must release the hostages so this crisis can end, and we can focus our efforts on bringing peace and stability to the region," Lew said.
