The Israeli government has approved the construction of more than 1,000 new homes in Jewish settlements in occupied Palestinian areas.
Housing Minister Uri Ariel said they would be built in the West Bank and East Jerusalem to meet the needs of Israeli citizens.
It comes three days before peace talks between Israel and the Palestinians are due to resume in Jerusalem.
The issue of settlement-building halted the last direct talks.
These collapsed in September 2010.
Jerusalem: Palestinians want East Jerusalem as capital of future state; Israel unwilling to divide it
Borders and settlements: Israel wants to keep major Jewish settlements; Palestinians want borders along 1967 lines but accept some settlements will have to stay in return for land swaps
Palestinian refugees: Israel rejects idea of a Palestinian "right of return"
Security: Israel wants final arrangement which will meet its security needs; Palestinians want state to have security from Israeli military action and not have sovereignty compromised.
In order to get the Palestinians to agree to the talks, Israel approved the release of more than 100 Palestinian prisoners.
The first group is due to be freed on 13 August.
About 500,000 Jews live in more than 100 settlements built since Israel's 1967 occupation of the West Bank and East Jerusalem. The Palestinians want to establish their state in those areas, as well as the Gaza Strip.
Mr Ariel said nearly 800 apartments would be built in east Jerusalem and nearly 400 in several large West Bank settlements.
"No country in the world takes orders from other countries [about] where it can build and where it can't,'' he said in a statement.
"We will continue to market housing and build in the entire country... This is the right thing at the present time, for Zionism and for the economy.''
Palestinian President Mahmoud Abbas had previously insisted he would not resume talks without an Israeli settlement freeze, but relented during mediation by US Secretary of State John Kerry.
Settlements are considered illegal under international law, although Israel disputes this.
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