Mrs Dee was killed on Friday with Maia Dee, 20, and Rina Dee, 15, when their car was shot at by a suspected Palestinian gunman.
Mourners gathered with Israeli flags along the roads of the Efrat settlement, near the Palestinian city of Bethlehem, where the family lived, The Jerusalem Post reported.
They moved to Israel nine years ago from the UK, where the girls’ father, Leo Dee, had served as a rabbi in Hertfordshire and north London.
Rabbi Dee described how “his family of seven is now a family of four”.
Rabbi Leo Dee told a press conference from Erfat on Monday that his daughters were killed by 20 bullets from a Kalashnikov rifle and his wife was shot twice.
Rabbi Dee described his wife and daughters as “three beautiful innocent young ladies in the prime of their lives” and urged people to post images of the Israeli flag on social media in their memory.
Five patients have received life-saving organ transplants from Mrs Dee, according to The Jerusalem Post.
Among them was Lital Valenci, a 51-year-old woman, who received a heart transplant, and a 58-year-old woman who underwent a lung transplant. Other patients received liver and kidney transplants.
Dr Evyatar Nesher, director of the transplant division at Rabin Medical Centre in Petah Tikva, told The Jerusalem Post: “I have been doing transplants for many years and am very moved by the strength of the donor family, the unimaginable nobility at a time of such a terrible tragedy.”
The Dee family were travelling in one of three cars on their way to Tiberias in the Galilee for a family holiday when they were shot.
The Israeli army said it has launched a manhunt to find the killer.
Tensions have been heightened by days of fighting at Jerusalem’s most holy site during the rare convergence of Ramadan, Passover and Easter.
Additional reporting by PA Media