The Palestinian Authority has cut all ties with the United States and Israel after rejecting Trump’s controversial proposal for Israel and Palestine, Mahmoud Abbas said on Saturday.

"We've informed the Israeli side...that there will be no relations at all with them and the United States including security ties," Abbas said at an extraordinary meeting of the Arab league in Cairo in which he reiterated his “complete” rejection of the plan.

On Saturday, the Arab League also rejected the plan.

The plan calls for the creation of a demilitarised Palestinian state with large swathes of the occupied West Bank annexed to Israel.

Negotiated between Israel and the US, the plan had no input from the Palestinians.

The PA has entrenched security ties with Israel with whom it cooperates to police areas of the occupied West Bank that fall under Palestinian control. Intelligence sharing agreements the PA has with the CIA could also now be under threat.

At the meeting in Cairo, attended by Arab foreign ministers, Abbas said he refused to discuss the plan with Trump.

"They told me Trump wants to send me the deal of the century to read, I said I would not," Abbas told the meeting of Arab League foreign ministers on Saturday.

"Trump asked that I speak to him over the phone, so I said 'no' and that he wants to send me a letter, so I refused to receive it."

Reaction to the plan from Arab countries has been mixed, with some Gulf states attending the launch in Washington and others, such as Jordan, largely rejecting it.

Arab League chief, Ahmed Aboul-Gheit, said on Wednesday that the plan “ignored legitimate Palestinian rights in the territories".

In August, the PA threatened to cut ties with Israel over its demolitions in the Occupied East Jerusalem town of Sur Bahir, which displaced dozens of Palestinians.