Ireland, along with other 11 European countries, urged Israel on Thursday to reverse its decision to advance plans to construct around 3,000 settlement units in the West Bank.
In a joint statement by the foreign ministries of Belgium, Denmark, Finland, France, Germany, Ireland, Italy, the Netherlands, Norway, Poland, Spain and Sweden, the countries said they opposed settlement expansion across the occupied Palestinian Territories.
"We call on both parties to build on steps taken in recent months to improve cooperation and reduce tensions," the countries said.
Israel moved forward on Wednesday with plans to build some 3,000 homes for Jewish settlers in the occupied West Bank, defying the strongest criticism to date of such projects from the administration of US president Joe Biden.
A senior Palestinian official said the decision showed that Israel's new government, led by far-right politician Naftali Bennett, was "no less extreme" than the administration of the veteran leader he replaced, Benjamin Netanyahu.
An Israeli defence official said a planning forum of Israel's liaison office with the Palestinians gave preliminary approval for plans to build 1,344 housing units and its final go-ahead for projects to construct 1,800 homes.
It will be up to defence minister Benny Gantz, a centrist in Israel's politically diverse government, to give the nod for construction permits to be issued, with further friction with Washington looming.
"This government is trying to balance between its good relations with the Biden administration and the various political constraints," a senior Israeli official told Reuters.
The United States said on Tuesday it was "deeply concerned" about Israel's plans to advance thousands of settlement units. It called such steps damaging to prospects for a two-state solution to the Israeli-Palestinian conflict and said it strongly opposes settlement expansion.
Asked about Wednesday's developments, a US State Department spokesperson said: "As we have said, this administration is strongly opposed to the expansion of settlements."
Washington desisted from such criticism when Democratic president Joe Biden's Republican predecessor, Donald Trump, was in office.
Most countries regard the settlements Israel has built in territory it captured in a 1967 Middle East war as illegal.
Israel disputes that and has settled some 440,000 Israelis in the West Bank, citing biblical, historical and political ties to the area, where 3 million Palestinians live.
Palestinians seek to create a state in the West Bank and Gaza, with East Jerusalem as its capital. Israeli-Palestinian peace talks collapsed in 2014.