US Secretary of State Hillary Clinton says Israeli demolitions of Palestinian homes in Israeli-occupied East Jerusalem are of "deep concern".
She renewed her commitment to an Israeli-Palestinian peace settlement, saying it was a "commitment I carry in my heart, not just my portfolio".
She was speaking after meeting Palestinian Authority President Mahmoud Abbas in the West Bank.
It is Mrs Clinton's her first trip to the region as secretary of state.
In Jerusalem and Tel Aviv on Tuesday, Mrs Clinton expressed "unshakeable" support for Israel, but restated the Obama administration's commitment to the creation of a Palestinian state alongside Israel.
She will not meet leaders of the rival Palestinian group Hamas, which has dismissed her visit.
Observers say they are watching for signs that Washington is determined to make advances on the - until now intractable - problem of securing a peace settlement in the Middle East.
Mrs Clinton said the "unhelpful" planned demolition of homes in Israeli-occupied East Jerusalem would be "taken up" with Israel's government.
Israeli settlement-building continues apace
Dozens of houses - which Israel says were illegally constructed, but which Palestinians say Israel refuses to permit them to build - are due to be torn down in Silwan to make way for a park. The demolition orders have been vociferously condemned by Palestinian leaders.
They were among the topics discussed by Mrs Clinton and Mr Abbas during their talks, which also included the situation in the war-ravaged Gaza Strip and moribund Israeli-Palestinian peace talks.
Mrs Clinton said she was "proud" to stand by President Abbas, and to "deliver a message from our country: the United States supports the Palestinian Authority as the only legitimate government of the Palestinian people".
The US has refused to speak to Hamas, which leads the Gaza Strip, saying it is a terrorist organisation.
Earlier, Hamas spokesman Fawzi Barhoum dismissed Mrs Clinton's visit, saying her statements so far had been "totally biased in favour of the Zionist occupation and do not reflect any change in American foreign policy", AP news agency reported.
'Time is ripe'
Mrs Clinton said the US aimed to foster conditions in which a Palestinian state could be fully realised, adding that "time is of the essence".
On the plight of residents of Gaza, recently hit by a 22-day Israeli bombardment, she pledged a commitment to reconstruction, saying a "child growing up in Gaza... has the same right to go to school, see a doctor, and live with a roof over her head as a child in any country".
On peace negotiations, Mr Abbas said he believed "the time is ripe to put final-status issues" - issues including the status of East Jerusalem, Palestinian refugees, borders, and Israelis settlements - and he added, Palestinian prisoners held by Israel.
He said he respected Israelis' choice at the ballot box, but added that the Israeli government should commit itself to the peace "roadmap" and the two-state solution.
A year of peace talks between Mr Abbas' administration and the Israelis have yielded few results.
Meanwhile, Israeli settlement-building has continued, with nearly half a million settlers now occupying land in the West Bank and East Jerusalem in contravention to international law, though Israel disputes this.
The BBC's Middle East editor, Jeremy Bowen, says that the big question is whether the new US administration of Barack Obama is prepared to twist Mr Netanyahu's arm on the two-state solution.
He says there are signs of a growing feeling in Washington that allowing Israel total freedom to decide its own policy on the Palestinians may not, in fact, be a productive way to address Israel's security problems.
But he says the main Israeli objection to a Palestinian state is that if it was controlled by an enemy entity such as Hamas, that could in fact be disastrous for Israeli security.
'The Palestinians' own deep internal divisions are also an obstacle to an effective settlement.
Gaza is in the hands of the Islamist Hamas faction, while the West Bank administration is led by the more secular Fatah group - though Israeli forces occupy large swathes of the West Bank and both territories are subject to external Israeli controls.
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