The U.S. on Monday condemned Israel's approval of 90 new homes to be built in Beit El, a Jewish community north of Jerusalem.
In Washington, U.S. State Department spokeswoman Victoria Nuland said she had not seen Israel's announcement but repeated the Obama administration's opposition to such settlement building.
"Our position on this has not changed. We don't think it's helpful," Nuland told reporters at her daily briefing.
Israel's decision could widen a rift with Washington ahead of a visit by President Barack Obama.
Prime Minister Benjamin Netanyahu has pledged that 300 new homes will eventually be erected in Beit El, from where 30 families were evicted last June after the Supreme Court ruled they were residing illegally on private Palestinian land.
The structures that were given the final approval on Monday will house educational staff, the Defense Ministry said.
Israel has come under international criticism, including from its main ally, the U.S., over its construction policy in Judea and Samaria.
Both Israel and the U.S. have played down speculation that Obama's trip could result in the revival of U.S.-hosted peace talks with the Palestinians.
"The Palestinian position is clear. There can be no negotiations while settlement continues," Nabil Abu Rdainah, a spokesman for Palestinian Authority President Mahmoud Abbas, said in response to the new Beit El construction.
Meanwhile, the Yesha Council said in a statement that it welcomed any decision to build in Judea and Samaria, according to Army Radio.
Army Radio quoted Peace Now chairman Yariv Oppenheimer as saying, "Advancing these plans could cast a shadow over Obama's visit. This decision is wrong, problematic and unfortunate."