WASHINGTON: The Obama administration on Monday harshly criticized its top Mideast ally, Israel, over new settlement construction plans in areas the Palestinians claim for a future state.

The State Department said the plans, notably one to begin preliminary work on an especially sensitive piece of land outside Jerusalem known as E1, are "especially damaging" to prospects for a resumption in Israeli-Palestinian peace talks and run counter to longstanding U.S. policy.

"The United States opposes all unilateral actions, including West Bank settlement activity and housing construction in East Jerusalem, as they complicate efforts to resume direct, bilateral negotiations, and risk prejudging the outcome of those negotiations," spokesman Mark Toner said in a statement.

"This includes building in the E1 area as this area is particularly sensitive and construction there would be especially damaging to efforts to achieve a two-state solution."

Israel on Friday announced that it would move ahead on plans to build 3,000 settler homes in the West Bank and east Jerusalem on territory the Palestinians claim as theirs to punish the Palestinians for winning U.N. recognition. It also said it would begin planning work in E1, where construction would essentially end hopes for an eventual Palestinian state to be contiguous.

Building in E1 would sever the link between the West Bank and east Jerusalem, which the Palestinians claim for a future capital. It would also cut off the northern part of the West Bank from its southern flank.

"We have made clear to the Israeli government that such action is contrary to U.S. policy," Toner said. "The United States and the international community expect all parties to play a constructive role in efforts to achieve peace. We urge the parties to cease unilateral actions and take concrete steps to return to direct negotiations so all the issues can be discussed and the goal of two states living side by side in peace and security can be realized."

The Palestinians say construction in that territory would kill any hope for establishing a viable state of Palestine. Successive U.S. governments have agreed, and under intense American pressure, Israel has avoided building settlements in the area. It has, however, developed roads and infrastructure and built a police station.