The announcement was part of a new Israeli settlement push announced earlier this month as retaliation for the Palestinians' success in winning U.N. recognition for a state at the United Nations. Israel was widely criticized internationally for the settlement plans, though actual construction would be far in the future.

An Interior Ministry committee on Monday approved an intermediate stage of planning for the construction of 1,500 apartments in the Ramat Shlomo neighborhood, a part of the city Palestinians claim for a future capital. The plan had been in the pipeline since it was first announced in 2010 during a visit to Israel by Vice President Joe Biden, causing a major diplomatic rift with Washington that took months to mend.

Ministry spokeswoman Efrat Orbach said the project still must go through several additional planning stages, and it could be years before final approval and construction.

Nabil Abu Rdeneh, a spokesman for Palestinian President Mahmoud Abbas, condemned the move, calling it a "stark challenge to the entire international community."

There was no immediate American reaction.

Israel announced plans early this month to build thousands of settlement homes, including in Ramat Shlomo, in response to the U.N. General Assembly's recognition of a Palestinian state in the West Bank, east Jerusalem and Gaza Strip, territories captured by Israel in the 1967 Mideast war. The U.S., Israel's closest ally, condemned the construction plans, and several European allies summoned Israeli ambassadors to lodge formal protests.

Israel strongly objected to the Palestinian's U.N. bid, saying it was an attempt to bypass negotiations. Israel rejects a return to its 1967 lines.

Israel annexed east Jerusalem following the 1967 war and claims the area, home to sensitive Jewish, Christian and Muslim holy sites, as an inseparable part of its capital. The Palestinians also claim east Jerusalem as the capital of their hoped-for state. About 200,000 Jews and roughly 250,000 Palestinians live in east Jerusalem.

While Israelis consider its east Jerusalem enclaves to be neighborhoods like others in the city, the international does not recognize Israel's annexation of the area and rejects the sections as illegal or illegitimate settlements.

Abbas has refused to negotiate with Israel so long as settlement construction continues, leading to a four-year lull in talks. Abbas has said that a stalemate in talks urged him to turn to the U.N.

Support is growing for his political opponents, Gaza's militant Islamic Hamas rulers, following eight days of fighting with Israel last month. Hamas leader Ismail Haniyeh might defeat Abbas if an election were held today for the presidency, according to a poll published Monday by the Palestinian Center for Policy and Survey Research.

The survey said Haniyeh would receive 48 percent of the Palestinian vote and 46 percent for Abbas, a virtual tie. Just three months ago, Abbas received the support of 51 percent and Haniyeh 40 percent.

The poll surveyed 1,270 Palestinians and had a margin of error of three percentage points.