Settlers across the West Bank are ready to begin building again
Israel's PM Benjamin Netanyahu has urged the Palestinians to continue peace talks despite an end to Israel's ban on West Bank settlement-building.
In a statement moments after the end of the 10-month partial freeze, he asked Palestinian leader Mahmoud Abbas to continue seeking a "historic" deal.
Earlier, Mr Abbas warned that peace talks would be a "waste of time" unless the freeze was extended.
Jewish settlers in the West Bank are expected to resume building on Monday.
Mr Abbas has made no public comments since the moratorium ended.
Meanwhile, the US renewed calls for Israel to maintain the construction freeze, saying its position on the issue remained unchanged and the US state department was staying "in close touch" with all parties.
US Secretary of State Hillary Clinton spoke with Mr Netanyahu and also with Tony Blair, the representative of the Middle East Quartet (the EU, Russia, the UN and US), as the end of the construction freeze neared, a spokesman said.
Israel says the settlements are no bar to continuing direct talks on key issues, and US negotiators have been working intensively to secure a deal.
On Saturday, Israeli Defence Minister Ehud Barak told the BBC he would attempt to convince government colleagues of a compromise deal, said the chances of a deal on the issue was "50/50".
Settlers' celebrations
The freeze on building in the West Bank expired at midnight local time on Sunday (2200 GMT).
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"Israel is ready to pursue continuous contacts in the coming days to find a way to continue peace talks between Israel and the Palestinian Authority," Mr Netanyahu said in his statement.
He called on the Palestinians to continue the talks, which recently resumed after a 20-month pause and have the strong backing of US President Barack Obama.
It was possible "to achieve a historic framework accord within a year", Mr Netanyahu said.
However, his statement did not directly mention the issue of the settlement freeze.
Earlier, the Israeli premier urged Jewish settlers "to display restraint and responsibility" once the moratorium had expired.
On Sunday, Mr Abbas, the Palestinian Authority president, warned that the peace talks renewed earlier this month would be futile unless the ban continued.
"If Israel does not continue the settlement freeze, the peace process will be a waste of time," the AFP news agency quoted him as saying during a visit to Paris.
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However, Mr Abbas suggested that he would consult with other Arab leaders before any decision was taken. A meeting is expected in Cairo within the next 10 days.
Meanwhile, some Jewish settlers have started celebrating the end of the construction ban.
At the Jewish settlement of Revava, near the Palestinian town of Deir Itsia, reports said they released balloons and broke ground for a new nursery school before the moratorium expired.
It is estimated that about 2,000 housing units in the West Bank already have approval and settler leaders say they plan to resume construction as soon as possible.
The partial moratorium on new construction was agreed to by Israel in November 2009 under pressure from Washington.
It banned construction in the West Bank, occupied by Israel since the Middle East war of 1967, but never applied to settlements in East Jerusalem.
US President Barack Obama has urged Israel to extend the moratorium, saying it "made a difference on the ground, and improved the atmosphere for talks".
Nearly half a million Jews live in more than 100 settlements built since Israel's 1967 occupation of the West Bank and East Jerusalem. They are held to be illegal under international law, although Israel disputes this.
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