There are already 430,000 Jewish settlers in the West Bank

In a rare rebuke of its close ally, the State Department said such a construction would violate the peace plan known as the roadmap.

Israel said 30 houses for former Gaza Strip settlers will be built in the Jordan Valley.

The 2003 roadmap calls for a complete halt to all settlement activity.

It marks the first time since 1992 that Israel has approved a new settlement, rather than expanding existing ones, Israeli settlement watchdog Peace Now said.

The US calls on Israel to meet its roadmap obligations and avoid taking steps that could be viewed as predetermining the outcome of final-status negotiations [with the Palestinians]

Gonzo Gallegos

State Department spokesman

Settlements in the occupied West Bank are illegal under international law, although Israel rejects this.

There are an estimated 430,000 Israeli settlers living in the West Bank, including East Jerusalem.

Saeb Erekat, an aide to Palestinian President Mahmoud Abbas, condemned the planned construction and urged the Israeli government to revoke authorisation of the settlement.

He said the plan violated a new spirit of co-operation inaugurated by a recent meeting between Mr Abbas and Israeli Prime Minister Ehud Olmert.

'Obligations'

State Department spokesman Gonzo Gallegos urged Israel to comply with the internationally-backed blueprint for peace.

"The establishment of a new settlement or the expansion of an existing settlement would violate Israel's obligations under the roadmap," he said.

"The US calls on Israel to meet its roadmap obligations and avoid taking steps that could be viewed as predetermining the outcome of final-status negotiations [with the Palestinians]." Earlier the European Union also expressed its "deep concern" at Israel's decision.

The construction of the Maskiot settlement at a former army base in the northern Jordan Valley will begin within weeks, Israeli officials said.

The roadmap, which also calls for the Palestinians to crack down on militants, has effectively been frozen for months amid soaring violence between the two sides.

It was devised by the Middle East mediators or quartet made up of the US, the United Nations, the European Union and Russia as an effort to lay the ground for the eventual creation of a Palestinian state.

Rice visit

The BBC's Jonathan Beale in Washington says that the timing of this criticism from the US - a key ally of Israel - is important.

US Secretary of State Condoleezza Rice is expected to visit the Middle East in the New Year in what has been seen as an effort to try to restart the stalled peace process.

Any move by Israel that would allow the creation of a new Jewish settlement would make tough negotiations even more difficult.

Israel pulled its military and more than 8,000 settlers out of the Gaza Strip in 2005 under former Prime Minister Ariel Sharon's disengagement plan after a 38-year occupation.

Israel has carried out a range of military operations in the territory aimed, Israel says, at stopping rocket fire by Palestinian militants and trying to secure the release of an Israeli soldier captured by Palestinian militants.