Chief Palestinian Negotiator Saeb Erekat condemned on Friday Israel's decision to build 930 new housing units in Jerusalem's southeast neighborhood of Har Homa.
The decision was announced by the Interior Ministry on Thursday. Har Homa is located beyond the Green Line.
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Erekat slammed the decision as illegal, adding that in pursuing the project, Israel was making clear "its intention to turn this occupation into an effective annexation."
In a statement issued on Friday afternoon, the Palestinian official said that the decision was also "a flagrant violation of the International Roadmap, which was consecrated in UN Security Council resolution 1515.
"It demonstrates Israel's disrespect and disdain for the international community, which has repeatedly condemned settlement construction as an illegal obstacle to the peace process.
"The (Israeli) government is determined to invest solely in the entrenchment of the occupation, rather than peace. By approving the expansion of this illegal settlement... Israel proves it is intent on sabotaging any international effort to reach a negotiated settlement to the conflict based on the principle of two states,” the statement said.
Erekat further urged the international community to answer Israel's actions by supporting the Palestinian Authority's unilateral bid for statehood in September.
Har Homa construction site (Archives: AP)
Meanwhile, EU Foreign Policy Chief Catherine Ashton also expressed her disapproval of Israel's decision, saying she was "profoundly disappointed" by Thursday's approval of the project.
"The European Union has repeatedly urged the government of Israel to immediately end all settlement activities in the West Bank, including in East Jerusalem. All settlement activities are illegal under international law," she added in a statement.
Israel's decision to further expand settlements was "particularly regrettable" at a time when the international community was working to restore talks leading to a solution of the conflict, Ashton said.
"Continued settlement undermines trust between the parties and efforts to resume negotiations. This is especially true with regard to Jerusalem.
"I believe there can be no sustainable peace in the Middle East without a two-state solution with the state of Israel and a viable and contiguous Palestinian state living side by side in peace and security.
"Settlement activity damages this prospect," she concluded.
News agencies contributed to this report
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