The UN Security Council demands that Israel halt settlements, in a resolution adopted after the US refrained from vetoing the contentious measure.

Israel's ambassador in New Zealand has been recalled to the Middle East by the Netanyahu administration, and possible sanctions against NZ from Israel, after a United Nations security council resolution condemning settlements in Palestinian territories.

The UN has demanded an end to Israeli settlements, after the United States broke a long-standing tradition of support and abstained from vetoing a security council vote.

It marks the first UN council resolution criticising Israeli settlement and occupation of the Palestinian territories in 30 years.

On Friday, the resolution led by four countries, New Zealand, Malaysia, Senegal, and Venezuela, put forward a motion criticising settlement in east Jerusalem and the West Bank and noted the hopes for a Palestinian state.

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BAZ RATNER A construction site is seen in the West Bank Jewish settlement of Givat Zeev, near Jerusalem, in 2013.

Israel prime minister Benjamin Netanyahu was furious, rounding on the UN resolution and calling it "shameful".

The resolution said settlement - many in place since 1967 - "altered the demographic composition, character, and status of the Palestinian territory."

Voting passed 14 to zero and the Obama administration, in a stunning change of position, abstained from voting.

KEVIN LAMARQUE/REUTERS US President Barack Obama has had an acrimonious relationship with Israeli Prime Minister Benjamin Netanyahu.

The Israeli ambassador in New Zealand, Dr Itzhak Gerberg, and their ambassador in Senegal, have been recalled to the Middle East for talks.

"The Obama administration not only failed to protect Israel against this gang-up at the UN, it colluded with it behind the scenes," Netanyahu wrote in a strongly worded statement, which was unusually released on the Jewish Sabbath eve.

UPDATE: Israel says will impose sanctions on New Zealand, Senegal for calling for Security Council vote https://t.co/VrbD04meVR — Haaretz.com (@haaretzcom) December 23, 2016

UN demands end to Israeli settlements after US abstains

Netanyahu and US President Barack Obama have had a strained relationship, especially over the issue of Israeli settlements.

Hours before the council met to discuss the resolution, Israeli media reported that an anonymous Israeli official had accused Obama and US Secretary of State John Kerry of scheming behind Israel's back to push the resolution through.

The resolution, initially brought by the Egyptians, had been scheduled for a vote on Thursday.

Israeli pressure and a push from president-elect Donald Trump caused the Egyptians to table it. It was revived Friday by other members of the Security Council.

Immediately after the vote, Netanyahu ordered a series of diplomatic steps against countries that co-sponsored the resolution and with whom Israel has diplomatic relations.

He also cancelled Israeli aid programs in Senegal.

In his statement, Netanyahu also said he looked forward to working with Trump.

Since the election, Netanyahu and his ministers have refrained from making public statements about Trump, but subtle words and gestures have suggested that the Israeli leadership is buoyed by having a new administration.

About 400,000 Jewish settlers live on 125 settlements and 100 outposts in the Israeli-occupied West Bank.

The Palestinians called the UN approval of the resolution "a victory."

Saeb Erekat, a former peace negotiator and the number two in the Palestine Liberation Organization, said the vote was a "clear and unanimous message to Netanyahu that "your policies will not achieve peace and security for Israel or the region."

"The only way to peace is through the creation of an independent Palestinian state, and this is what the international community agreed upon today at the Security Council," he said.