JERUSALEM -- Israel is moving forward with development of Jewish settlements in a contentious area east of Jerusalem, defying the United States by advancing a project that has long been condemned by international leaders as effectively dooming any prospect of a two-state solution to the Israeli-Palestinian conflict.
One day after the United Nations General Assembly voted overwhelming to upgrade the Palestinians' status, a senior Israeli official, speaking on the condition of anonymity, said the government would pursue "preliminary zoning and planning preparations" for a development that would separate the West Bank cities of Ramallah and Bethlehem from Jerusalem -- preventing the possibility of a viable, contiguous Palestinian state.
The development, in an area known as E1, would connect the large settlement town of Maale Adumim to Jerusalem. It is one of the projects that appear aimed, or at least timed, to punish the Palestinians for moving ahead with their United Nations bid. Israel also authorized the construction of 3,000 new housing units in parts of East Jerusalem and the West Bank.
The twin actions seemed to demonstrate that hard-liners in the government had prevailed after days of debate over how to respond to the United Nations action. The implications of such a move marked a surprising turnaround after a growing sense in recent days that Israeli leaders had acceded to pressure from Washington not to react quickly or harshly.
"This is a new act of defiance from the Israeli government," Saab Erekat, the Palestinians' chief negotiator, said in a statement. "At a moment where the Palestinian leadership is doing every single effort to save the two-state solution, the Israeli government does everything possible to destroy it."
The White House quickly condemned the move as unhelpful.
"We reiterate our longstanding opposition to settlements and East Jerusalem construction and announcements," said Tommy Vietor, a White House spokesman. "We believe these actions are counterproductive and make it harder to resume direct negotiations or achieve a two-state solution. Direct negotiations remain our goal, and we encourage all parties to take steps to make that easier to achieve."
The office of Prime Minister Benjamin Netanyahu refused to comment on the zoning and construction decisions, which were made Thursday night around the time of the General Assembly vote. But Israel has long maintained its right to develop neighborhoods throughout East Jerusalem and the West Bank -- more than 500,000 Jews already live there -- and Mr. Netanyahu, responding to the United Nations speech by President Mahmoud Abbas of the Palestinian Authority, said, "Someone who wants peace does not talk in such a manner."
While Israel has frequently announced settlement expansions at delicate political moments, often to its detriment, the E1 move came as a shock, after a week in which both Israelis and Palestinians toned down their rhetoric about day-after responses to the United Nations bid. Avigdor Lieberman, the ultranationalist foreign minister who for months denounced the Palestinian initiative as "diplomatic terrorism" and said Israel should consider severe sanctions against the Palestinian Authority, told reporters in recent days that there would be "no automatic response."
Mr. Erekat's spokesman declined to discuss whether the Palestinians would use their upgraded status, as a nonmember observer state with access to United Nations institutions, to pursue a case in International Criminal Court regarding E1 or the other settlement expansion. Less contentious moves were already in progress: the Palestinian Authority has begun changing its name to "Palestine" on official documents, contracts and Web sites, and several nations are considering raising the level of diplomatic relations, giving Palestinian envoys the title of ambassador.
All but one European country voted with the Palestinians or abstained, many citing concerns about settlements in West Bank and East Jerusalem territories Israel captured in the 1967 war, which they consider illegal. The United States, one of eight countries that stood with Israel in voting against the Palestinian upgrade, has for two decades vigorously opposed construction in E1, a 4.6-square-mile expanse of hilly parkland where some Bedouins have camps and a police station was opened in 2008.
After a day in which Israeli government officials insisted that the United Nations vote was a purely symbolic one that had not changed anything on the ground, the revelation of the development moves late Friday stunned and outraged even some of Mr. Netanyahu's supporters.
"A number of important countries are telling us that they think it's wrong to do settlements, and these are our best friends," noted one senior government official, speaking on the condition of anonymity for fear of being fired. "After they say this directly or indirectly, the immediate response is to build more settlements, even in one of the most controversial areas, E1? How does that make sense? What is the message the government is sending its best friends?"
Dani Dayan, the leader of Israel's settler movement, said the development of E1 was an "important Israeli strategic interest," but he, too, was somewhat dismayed by the timing.
"We don't like the idea of developing our communities as a sort of retaliatory or punitive step," Mr. Dayan said. "I think it should be done routinely. We have a legal and a political and a moral right to build."
Shelley Yachnimovich, head of the left-wing Labor Party, also questioned Mr. Netanyahu's timing. "Construction in the Jewish neighborhoods of Jerusalem is not controversial," she said in a television interview Friday night. "But to do this now? That's sticking a finger in the eye. It's raising the height of the flames. And it's already been proven that raising the level of the flames isn't good for us."
It is hardly the first time Israel has been criticized for awkward timing. In August, a month before Mr. Abbas's failed bid for upgraded status at the United Nations Security Council, its Interior Ministry gave final approval for the construction of a 1,600-unit apartment complex in another East Jerusalem neighborhood, Ramat Shlomo. On the eve of an April 2011 meeting between President Obama and Israel's president, Shimon Peres, a Jerusalem planning committee gave its go-ahead for 1,000 units in Gilo, a neighborhood in the city's south that was Jordanian territory before 1967. And in 2010, Mr. Netanyahu was embarrassed by an early approval of the Ramat Shlomo development issued hours after a Jerusalem visit by Vice President Joseph R. Biden Jr.
But E1 -- where a preliminary plan approved years ago calls for 3,910 housing units, 2,192 hotel rooms and an industrial park in addition to the police station -- is more contentious than all those developments combined. Presidents Bill Clinton, George W. Bush and Obama have all strenuously objected to any settlement there, and it is internationally known as the third rail for the peace process.
Dani Seidemann, a Jerusalem lawyer and peace activist, described E1 as "the fatal heart attack of the two-state solution" and said Mr. Netanyahu was wielding "the doomsday weapon."
"This is punitive: 'Don't mess with me -- you have the ability to get the votes, I have the ability to build the buildings,' " Mr. Seidemann said, speaking as the prime minister.
But Mr. Seidemann and others noted that the approval was only for zoning and planning, early steps in a months-long development process before bulldozers begin work, and could be just what he called "the dramatic flourish."
"We're going to stop this," he said. "If Netanyahu decides to pursue E1, Henny Penny the sky will fall on him. If he pursues this, Israel is going to find itself isolated in a non-wartime situation as we have never been before."
Peter Baker contributed reporting from Hatfield, Pa.
This article originally appeared in The New York Times.