"I will sit alone directly with President Abbas in the Élysée Palace, or anywhere else that you choose. Every difficult issue will be on the table: mutual recognition, incitement, borders, refugees and yes, settlements – everything," Netanyahu told a joint press conference with French Prime Minister Manuel Valls, who is visiting Israel.
The French initiative, which calls for an international peace conference, "will not encourage peace between Israel. Peace just does not get achieved through international conferences, UN-style. It doesn't get to fruition through international diktats or committees from countries around the world who are sitting and seeking to decide our fate and our security when they have no direct stake in it," Netanyahu said.
Direct negotiations with the Palestinians are "the only way to proceed to peace," Netanyahu said. He offered "a different French initiative" of "direct negotiations without preconditions, between the Israeli prime minister, the Palestinian president in Paris."
Valls said he would speak to President Francois Hollande about Netanyahu's proposal.
Valls is visiting Israel and the Palestinian territories to advance his country's plan to restart Israeli-Palestinian peace efforts.
Abbas has welcomed the French initiative to hold a meeting of foreign ministers from a range of countries on June 3, without the Israelis and Palestinians present.
Another conference would then be held in the fall, with the Israelis and Palestinians in attendance. The goal is to eventually restart negotiations that would lead to a Palestinian state.
President Reuven Rivlin delivered a similar message to Valls in his meeting with the French leader.
"We are convinced that the only way to bring an end to this tragedy of 150 years between us and our cousins the Palestinians, is through direct negotiations," Rivlin told Valls earlier Monday.
"In the Middle East, there are no shortcuts. Reaching an understanding and an agreement requires direct negotiations out of mutual trust, with both sides truly wanting to live side by side in peace in this land.
"The Israeli people are in no doubt of your sincere and good intentions to bringing a solution to the conflict, but we are concerned that going through international channels will make redundant our demand of the Palestinian side, and the Palestinian President, to come and talk directly with us in order to find a solution, a lasting solution for peace between us and others living in this land, the Palestinians."
Negotiations between the Israelis and Palestinians have been at a standstill since a US-led initiative collapsed in April 2014.
Netanyahu has repeatedly offered to meet Abbas for direct talks, while Palestinians leaders say years of negotiations with Israel have not ended its occupation and have pursued a strategy of diplomacy at international bodies.
AFP contributed to this report.