President Obama and Israeli Prime Minister Binyamin Netanyahu yesterday outlined the shared goals of preventing Iran from developing nuclear weapons and of achieving a peace agreement between Israel and the Palestinians. But within those broad areas of agreement were significant differences in tone and terminology that exposed their divergent approaches toward achieving peace in the Middle East.

Obama has endorsed the creation of a Palestinian state alongside Israel as the best way to establish peace between it and other Arab nations, only two of which currently recognize the Jewish state. After two hours of talks at the White House, Obama said Israel, the Palestinians and the Arab states must do more to achieve regional peace, making clear that "when it comes to my policies towards Israel and the Middle East that Israel's security is paramount."

Netanyahu, who took office in March at the head of a fragile and sharply hawkish governing coalition, declined to endorse Obama's call for a two-state solution to the conflict. He made clear that his interest in checking Iran's nuclear ambitions is far greater than his desire to revive dormant peace negotiations with a divided Palestinian leadership.

Netanyahu said he wanted "to make clear we do not want to govern the Palestinians," but he did not mention a Palestinian state as the ultimate goal of talks.

Saeb Erekat, a veteran Palestinian peace negotiator, said in a statement that "calling for negotiations without a clearly defined end-goal offers only the promise of more process, not progress."

For peace talks to begin, Netanyahu said, the Palestinians must first recognize Israel's right to exist as a Jewish state and "allow Israel the means to defend itself." That phrase is often used as a coded demand for the Palestinians to relinquish parts of the West Bank to Israel in any final peace agreement.

"We're ready to do our share," Netanyahu said. "We hope the Palestinians will do their share as well."

Obama's meeting with Netanyahu, their first as their nations' leaders, began a weeks-long focus by the new U.S. administration on Middle East diplomacy. Next week Obama will host Egyptian President Hosni Mubarak and Palestinian Authority President Mahmoud Abbas at the White House, followed by a trip to Egypt, where he will deliver an address to the Islamic world.

Much of the region is watching to see whether Obama, who has promised an early and continual focus on Middle East peace, will depart from the Bush administration's late-inning efforts, which, critics say, yielded few results.

Many Israelis are also seeking early evidence of whether the sometimes abrasive Netanyahu, who served as prime minister from 1996 to 1999, can manage Israel's most important diplomatic relationship by getting along with a popular U.S. president. Their one-on-one meeting yesterday ran half an hour longer than scheduled, which Israeli observers took as a good sign.

Obama has said resolving the Israeli-Palestinian conflict is critical to regional stability, a more strategic view of the dispute than the Bush administration had. The Bush administration's invasion of Iraq and its perceived favoritism toward Israel alienated many in the region.

Despite his hard-line stand, Netanyahu signed an agreement with the Palestinian leadership to share Hebron, a highly contested city in the occupied West Bank, during his earlier tenure as prime minister.

He and Obama said yesterday they hope to draw more Arab nations into a future Israeli-Palestinian peace process, an approach that has been tried without results.

Netanyahu said more Arab participation would "buttress" Israeli-Palestinian negotiations, and Obama said Arab states are "looking for an opportunity to break this long-standing impasse, but aren't sure how to do it."

"The Palestinians are going to have to do a better job of providing the kinds of security assurances that Israelis would need to achieve a two-state solution," Obama added. "The other Arab states have to be more supportive and be bolder in seeking potential normalization with Israel."

Obama said "Israel is going to have to take some difficult steps as well." Specifically, he said construction of Israeli settlements in the West Bank, which the Bush administration called one of the biggest obstacles to peace, "will have to be stopped in order for us to move forward."

Since the armed Islamist movement Hamas seized control of the Gaza Strip in 2007, Israel has imposed a punishing blockade on the territory to stop rocket fire into southern Israel. Obama said yesterday that "the humanitarian situation in Gaza has to be addressed."

The Palestinian leadership is deeply divided between Abbas's relatively moderate Fatah party, which holds sway in the West Bank, and Hamas, which rejects Israel's right to exist. The split is preventing the Palestinian national movement from developing a unified approach for how to pursue peace with Israel.

The Obama administration has signaled it might accept a Palestinian unity government that includes Hamas, something the Bush administration and the previous Israeli government would not recognize despite the Islamist movement's victory in the 2006 Palestinian parliamentary elections.

Before the meeting, senior Obama administration officials said they wanted Netanyahu to pursue peace with the Palestinians, then focus on Iran. The approach would win Israel goodwill in the region, especially among such important Sunni Arab governments as Saudi Arabia and the United Arab Emirates that also fear Shiite Iran's nuclear ambitions.

"There's never been a time when Arabs and Israelis see a common threat the way we see it today," Netanyahu said. "We want to move simultaneously and then parallel on two fronts: the front of peace and the front of preventing Iran from acquiring nuclear capability."

Although Iran's leaders say they are working to create nuclear power only for civilian use, Netanyahu and others believe the program is designed to produce nuclear weapons, which Israel's government views as an existential threat to the Jewish state. Israel, which receives nearly $3 billion in annual military aid from the United States, has its own undeclared nuclear arsenal.

Acknowledging "deepening concern" over Iran's nuclear program, Obama declined yesterday to set a deadline for Tehran to end it, saying that he would wait until after that country's June presidential election to directly engage its leaders. Obama said he should know by the end of the year whether talks and international pressure are dissuading Iran's leadership from pursuing nuclear weapons.

"I am prepared to make what I believe will be a persuasive argument, that there should be a different course to be taken," he said.