Israeli Prime Minister Ehud Olmert, hoping to draw more Arab countries to a U.S.-sponsored peace conference this month, persuaded his cabinet Monday to endorse the release of hundreds of Palestinian prisoners and restated a pledge to stop building new Jewish settlements in the occupied territories.

But Palestinian officials said Olmert had not gone far enough in signaling his willingness to make concessions before the meeting, tentatively scheduled for Nov. 27 in Annapolis. Earlier in the day, Olmert cautioned against creating "exaggerated expectations," although he said the meeting is an important step in restarting formal negotiations with the Palestinians after nearly seven years of dormancy.

Such influential Arab countries as Saudi Arabia, which does not officially recognize Israel, are deciding now whether to attend the meeting. The release of Palestinian prisoners, roughly 10,000 of whom are in Israeli jails, and a freeze on all settlement activity have been two items the Saudis and other Arab countries have demanded in return for their participation.

Olmert appeared to be moving Monday to address some Arab concerns, which he will also discuss Tuesday with Egyptian President Hosni Mubarak in the Sinai resort city of Sharm el-Sheikh. Their talks come two days before the Arab League is scheduled to take a position on the Annapolis meeting, which the Bush administration is promoting zealously as it heads into its final year in office.

"The negotiations will begin after Annapolis and they will be very intensive, very serious and will deal with all the substantive issues that are an inseparable part of the process, which must lead to a solution of national states for two peoples," Olmert said before the cabinet meeting.

Hours later, Olmert met here with Palestinian Authority President Mahmoud Abbas in the hopes of resolving differences over the text of a joint statement to be read in Annapolis.

In recent days, Israeli and Palestinian officials have warned that a declaration may not be achieved. Olmert and Abbas adjourned after about 90 minutes without one, although Israeli officials said some progress had been made.

Israeli officials have demanded that the declaration include Palestinian recognition of Israel's right to exist as a Jewish state, something Palestinian leaders say would forfeit, before negotiations begin, the right claimed by Palestinian refugees to return to homes inside Israel. Palestinian leaders, meanwhile, have sought a complete freeze on settlement activity and a halt to the construction of the 456-mile barrier Israel is building in and around the West Bank.

Despite opposition from Olmert's hawkish coalition partners and the head of Israel's military, the cabinet approved in principle the release of 441 Palestinian prisoners, although the timing is unclear. Abbas, a moderate leader of the Fatah party, had sought the release of 2,000 prisoners.

Those on the list are nearly all Fatah members. The party's rival, the armed Islamic movement Hamas, seized the Gaza Strip in June and now operates a parallel government there. Abbas has called for Hamas's overthrow in Gaza, while Hamas leaders have warned him not to make concessions to Israel at the Annapolis meeting.

Olmert said Monday that he would uproot small West Bank settlements, known as outposts, that the Israeli government deems illegal. He also promised not to build new settlements in the West Bank, which the United Nations considers illegal under international law. But he did not specify whether his statement included a freeze on construction within the large settlement blocs, which he has said Israel intends to keep under any peace agreement.

Under the 2003 U.S.-backed peace blueprint known as the road map, Israel promised "to immediately dismantle settlement outposts erected since March 2001" and "freeze all settlement activity, including natural growth of settlements." Dozens of outposts remain standing, and the settlements have expanded significantly.

"What Olmert announced today is nonsense," Saeb Erekat, a member of the Palestinian negotiating team, told the Reuters news agency. "Olmert has to understand he either declares a full settlement freeze in all occupied areas, including East Jerusalem, or it's nothing."

Under the road map, Palestinian leaders promised "to arrest, disrupt, and restrain individuals and groups conducting and planning violent attacks on Israelis anywhere," a pledge Olmert and other Israelis say the Palestinians have not come close to meeting.

"It is impossible to repeat that the road map is a strategic asset for Israel and at the same time to ignore our obligations," Olmert said.