Critics say the placement and size of a newly proposed Israeli build-out would doom a two-state deal.
Palestinians seek a state in the West Bank and Gaza with a capital in East Jerusalem, which together represent about 22 percent of historical Palestine. Israel captured those areas in the 1967 war with its Arab neighbors, and has since withdrawn fully only from Gaza.
From the moment of Israel's 1967 victory, successive Israeli administrations have been divided about whether to claim all of the biblical land of Israel, build up settlements only in areas that would provide a security buffer against Arab neighbors, or refrain from building and trade land for peace.
The Israeli public is also divided. The mainstream agrees that major settlement blocs near the 1967 border would be absorbed into Israel under a future peace deal, while the rest of the West Bank would be given to the new Palestinian state.
But many settlers are driven by a conviction that God promised this land to the Jews, and that reclaiming it will usher in the messianic age. They describe settlement activity with a Hebrew word that means to take possession of an inheritance, and argue that no one can barter away that inheritance.
Despite United Nations resolutions declaring settlements to be illegal, the number of Israelis living in East Jerusalem and the West Bank has nearly doubled from 281,000 to more than 550,000 since the 1993 Oslo Accords were signed. Prime Minister Benjamin Netanyahu's government recently announced the approval of 3,000 new housing units to be built in existing settlements, furthering Palestinian anxiety that their future state is looking increasingly like Swiss cheese.
It's not just the numbers, but also the placement of settlements that matters. This is particularly true in and around Jerusalem. In a political game of tick-tack-toe, the Israeli government has fostered the development of Jewish settlements in between Palestinian neighborhoods and recently decided to advance plans to build up the E1 area, which would divide the West Bank and hinder Palestinian access to East Jerusalem. All that would remain would be a north-south Palestinian corridor about 10 miles wide, bisected by an Israeli-controlled road.