President Shimon Peres spoke at the 14th annual memorial ceremony for the assassination of former Prime Minister Yitzhak Rabin, and called on Palestinian President Mahmoud Abbas to continue efforts for peace.
Abbas announced recently that he would not seek a second term as president of the Palestinian Authority.
"We both signed the Oslo Accord, and I am turning to you now as a colleague: Don't give up!" Peres said.
"I know you have worked for your people for 50 years, work that was accompanied by much disappointment and frustration. But I know my people, and I know the Israeli government, and I am telling you that Israel wants true peace, not simulated peace."
Later, In a video message screened at the ceremony, US President Barack Obama paid tribute to Rabin and pledged to keep trying to get the Israelis and Palestinians back to the negotiating table.
"To all who seek peace I say tonight, you will always have a partner in the United States of America and in my administration," Obama said. "That's why we've been working aggressively for our clear goal, two states living side by side in peace and security."
Defense Minister Ehud Barak, who spoke after Peres, referred in his speech to the exposure of the Jewish terrorist Yaakov Teitel.
"Even in the midst of this memorial week we have had to deal with the discovery of an additional Jewish murderer," he said. "He dared to lift a hand against peace-loving Jews and Arabs whose opinions and lifestyles do not match his disgraceful views."
Barak also called on Palestinian President Mahmoud Abbas and Syrian President Bashar Assad to "come to the negotiating table".
"We are responsible before history, and each of us before every boy and girl, to gather courage and overcome past frustrations," he said. "This is our job as leaders – to change reality and bring peace."
Barak added, "We are ready for intensive negotiations without preconditions. The people and government of Israel understand what is at stake and are ready to make a decision."
Teens hold signs: 'Thou shalt not kill' (Photo: Yaron Brener)
'Shots fired to kill hope'
Peres, in a eulogy of Rabin, said, "He knew that those who starve peace fatten extremism, and those who reject the two-state solution will not bring a one-state solution. They will bring one fight, a fight of endless bloodshed."
He also spoke of Rabin's determination to achieve peace. "The three shots that caused his death were aimed at the peace process, and they were fired to kill hope," the president said.
Addressing the activists present at the ceremony he said, "Don't let your politicians off the hook, neither those on the Right nor those on the Left. Demand that they go after peace!"
After leaving the stage Peres told Ynet that negotiations with the Palestinians must be launched immediately in order to prevent Abbas from resigning from politics.
"Everyone hurt him: We did, and the Americans did. That is why he is full of anger. We must launch negotiations immediately in order to keep him in the picture," Peres said.
Like his colleague, Barak spoke of the need for peace and said that it "is made from a position of security and self-assuredness, and Israel is currently strong, deterring, and able to make peace".
Barak added, "The path is not an easy one, and we will suffer obstacles and victims, but it is because of this that we must persist."
Opposition chairwoman Tzipi Livni said at the ceremony that Israel was "sitting on a volcano".
"The illusion of peace is deceiving," she said. "But we have control over our destiny and we can determine what happens here in Israel to our children. It is possible if we understand that we have to make a difficult choice between a secure Jewish state in Israel and the whole land of Israel with a state which is not Jewish."
Education Minister Gideon Sa'ar also spoke, and said that a large number of mourners, who didn't necessarily agree with Rabin's vision, have been "pushed out from the mourning tent for too long".
"Fourteen years have passed and it is now time for every man to reach out to his brother, because this is the mourning of an entire people and the murder harmed values common to the whole nation," Sa'ar said.
Police estimate that around 25,000 people had gathered at Rabin Square to take part in the memorial ceremony.
AP contributed to this report