The Palestinian diplomatic mission in Washington on Tuesday hoisted its national flag for the first time, a highly symbolic gesture that drew an angry response from a senior US lawmaker.

The US State Department, enmeshed in an uphill struggle to revive stalled Middle East peace talks, said that the ceremony was approved several months ago and did not change the status of the Palestinian representation in Washington.

Maen Rashid Areikat, the envoy to the headquarters of the General Delegation of the PLO to the United States, raised the flag at a ceremony watched by journalists and others, the mission said.

The statement said delegates from the State Department and Arab League Ambassador Hussein Hasouneh attended the ceremony.

"This flag symbolizes the struggle of the Palestinian people for independence," Areikat was quoted by his mission as saying.

The flag "also is a clear message that the Palestinian people and the PLO are central players in the equation of the Middle East, without whom there will be no peace, security and stability in the region," he said.

But House Foreign Affairs Committee Chair Ileana Ros-Lehtinen, a Republican, blasted the move as "part of the Palestinian leadership's scheme to manipulate international acceptance and diplomatic recognition" of their future state.

The lawmaker charged that US President Barack Obama's administration was rewarding the Palestinians, whom she accused of refusing to negotiate with Israel while seeking "shortcuts to statehood."

"Governments worldwide will interpret such actions as tacit US recognition of a Palestinian state. These actions send precisely the wrong message to foreign governments," said Ros-Lehtinen.

US State Department spokesman Philip Crowley said: "The granting permission to raise the flag does not change their fundamental status."

The move came after direct US-brokered peace talks between Israel and the Palestinians ground to a halt late last year over Israel's refusal to renew a partial freeze on Jewish settlements on Palestinian land.

It also came as Arab nations prepare to formally put a resolution to the UN Security Council on Tuesday demanding a condemnation of Israel's settlement building in Palestinian territories.

But no vote was expected for several days as Palestinian and other Arab negotiators try to persuade the US administration not to veto the resolution, diplomats said.

"Our view hasn't changed ... We do not think that New York or the UN Security Council is the right forum for this issue, and we'll continue to make that case," Crowley said.

"I'm not going to speculate on what happens from this point forward," he said when asked about a possible US veto.

A senior State Department official told reporters on the condition of anonymity that the Palestinians have "been told we think this is a bad idea ... We're encouraging them not to move this forward."