The discord between the United States and Israel over Jewish building in East Jerusalem deepened Tuesday with Israeli officials saying they would reject demands by Washington and expressing anger over the public upbraiding of Prime Minister Benjamin Netanyahu by the Obama administration.
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Palestinians wearing masks took part Tuesday in disturbances in East Jerusalem, which they view as the capital of a future state.
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Rina Castelnuovo for The New York Times

Israeli police officers arrested a Palestinian stone thrower just outside the walls of Jerusalem's Old City on Tuesday.

On a day of scattered disturbances by Palestinians in East Jerusalem, news emerged that Israel was moving ahead with a second building project there. A notice on the Web site of the Israel Lands Authority invited bids on construction of 309 new homes in the Jewish suburb of Neve Yaakov, in northeast Jerusalem.

A spokesman for the Jerusalem municipality said building and planning across the city were moving ahead. “For us, it is business as usual,” the spokesman, Stephan Miller, said.

In the disturbances, several hundred Palestinian youths protesting Israeli control and construction in East Jerusalem set tires and garbage ablaze. The police responded with tear gas and rubber bullets. About 10 people were seriously injured and about 60 arrested, the police said.

The Palestinians want East Jerusalem for their future capital.

Israeli officials also grappled with a storm of American anger. The Obama administration’s Middle East envoy, George J. Mitchell, said Tuesday that he would not come here this week as originally scheduled, meaning indirect peace talks with the Palestinians are now officially delayed. In Washington, pro-Israel activists sought help from friends in Congress and elsewhere.

“They are demanding that Jews not be allowed to build in East Jerusalem,” Foreign Minister Avigdor Lieberman said on Israel Radio. “We cannot bar only Jews from building in a certain section of the city. Can you imagine if they told Jews in New York they could not build or buy in Queens?”

Since Israel has annexed East Jerusalem, Israeli officials say, a request to scrap Jewish building projects there is both legally unfeasible and a betrayal of the mandate of the current government, elected on a platform of keeping Jerusalem united under Israeli sovereignty.

Secretary of State Hillary Rodham Clinton asked Mr. Netanyahu in a telephone call last Friday to respond to a number of demands, but Israeli officials made clear Tuesday that there would be no quick reply.

In public, both sides tried to smooth over their differences.

In Washington, Mrs. Clinton sought to dampen reports of a diplomatic crisis, saying the relationship between Israel and the United States was not in danger. “We have an absolute commitment to Israel’s security,” she said at a news conference. “We have a close, unshakable bond between the United States and Israel.”

In Jerusalem, Mr. Netanyahu issued a statement saying that Israel “appreciates and respects the warm words” from Mrs. Clinton on “the deep bond between the U.S. and Israel, and on the U.S. commitment to Israel’s security.”

But serious disagreements remained. Mrs. Clinton said Washington expected action from Israel, and a crucial American demand is that Israel neither promote nor permit “provocative” acts, meaning anything that would disturb the atmosphere as Palestinians and Israelis prepare for the indirect peace talks. That would include new building projects.

When Vice President Joseph R. Biden Jr. was here last week, the government announced plans for 1,600 new Jewish housing units for East Jerusalem, setting off the tumult.

Because of other Israeli steps that the Americans considered provocative — declaring two sites in the occupied West Bank as Israeli heritage sites, announcing other large East Jerusalem housing construction projects and proposing a plan to remake an entire Palestinian neighborhood in East Jerusalem — the announcement last week was viewed with particular severity.

Mr. Netanyahu said he had been taken by surprise by the housing announcement and apologized for its timing. He thought the problem was behind him after Mr. Biden left on Thursday.

But President Obama and his aides say that Mr. Netanyahu should have been in control of the construction process and should have done what was needed to stop it, according to officials in Jerusalem and Washington.

Israeli officials, however, say that the Obama administration misread the situation, and that stopping building in Jerusalem was never an option.

“We must tell the American government that there are things we can do and things we cannot do,” said Dore Gold, a former Israeli ambassador to the United Nations, reflecting the government’s thinking. “Freezing building in East Jerusalem is one of those things we cannot do.”

Mr. Netanyahu has said Jerusalem’s future can be a topic of negotiation with the Palestinians, but the Israelis say that at no time did the government agree to modify its policy on Jerusalem as part of indirect talks. As Mr. Netanyahu said in Parliament on Monday, “No government of Israel for the last 40 years has agreed to place restrictions on building in Jerusalem.”

Israeli officials also say that some Obama administration officials have been implying that Mr. Netanyahu had been acting in bad faith.

David Axelrod, a top White House official, said on television on Sunday that the housing project announcement during the Biden visit “seemed calculated to undermine” the so-called proximity talks, in which American officials plan to shuttle between Israeli leaders in Jerusalem and Palestinian leaders in Ramallah, in the West Bank.

Israeli officials took umbrage at the suggestion that the announcement was aimed at sabotaging the talks, which they say they have been pressing to start for months.

But government opponents say that the way East Jerusalem building has been proceeding is not random. As evidence, they cite the latest announcement for the suburb of Neve Yaakov, which was dated March 11 but came to light on Tuesday when it was pointed out by the leftist group Peace Now.

“The Netanyahu government is trying to make Jerusalem indivisible so that it will not be possible to reach a solution based on two states for two peoples,” Hagit Ofran of Peace Now charged.

The current disagreement echoes one last year. The Obama administration demanded a complete settlement freeze in the West Bank, while the Israelis said it was impossible and was a betrayal of earlier agreements between Washington and Jerusalem. Ultimately, the Americans accepted a partial, 10-month moratorium on settlement building that excluded East Jerusalem. It was a compromise for both sides.