The Palestinians are set to ask the UN Security Council to condemn Israeli settlement construction, according to a copy of a draft resolution obtained by the AP news agency.

The move reflects growing Palestinian discontent with stalled US efforts to broker a peace agreement, and is part of a campaign to put international pressure on Israel.

American reaction to the plan has been muted, raising the likelihood that the country would use its veto power in the council to defeat the resolution.

Israel has angrily rejected the proposal.

American-mediated peace talks between Israel and the Palestinians have been stalled for more than three months, in large part due to disagreements over Israeli settlement construction in the West Bank and East Jerusalem, lands claimed by the Palestinians.

Saeb Erekat, the chief Palestinian negotiator, has said that the Palestinians’ Arab allies will present the resolution to the Security Council early next month.

The 15-member body has condemned settlement constructions several times in the past, but has stopped short of the kind of language used in the draft resolution, which asks the Security Council to declare that settlements are "illegal and constitute a major obstacle to the achievement of peace".

The draft, dated December 21, calls for a complete halt to all Israeli construction in the West Bank and East Jerusalem.

It also urges Israel and the Palestinians "to continue, in the interest of the promotion of peace and security, with their negotiations on the final status issues in the Middle East peace process" and calls for an "intensification" of international diplomatic efforts.

It does not contain a call for sanctions against Israel.

Yigal Palmor, an Israeli foreign ministry spokesman, condemned the move, saying that by "choosing unilateralism over direct talks, the Palestinians are declaring that they renounce peace altogether".

"The Palestinians are choosing not to renew negotiations and are doing all they can to score minor points. They are trying everything except to talk," he said.

Palestinian officials acknowledge that such moves will have little immediate effect on the ground, but say they want the international community to send a tough message to Binyamin Netanyahu, the Israeli prime minister, who they believe is not serious about pursuing peace.

Security Council decisions are considered binding under international law.

While the US has in the past condemned the construction of new settlements, asked to comment, Mark Toner, a US state department spokesman, said the US believes that an agreement is possible only through negotiations.

"We therefore consistently oppose any attempt to take final status issues to the [UN Security] Council, as such efforts do not move us closer to our goal of two states living side by side in peace and security," he said.

While the Palestinians say they remain committed to a negotiated peace deal, they have grown increasingly frustrated with the slow rate of progress, and have begun to take alternative measures to put pressure on Israel.

As part of this campaign, they have been seeking unilateral recognition of an independent Palestinian state.

So far, Brazil, Argentina, Bolvia and Ecuador have all announced this recognition in the past month, and Chile, Mexico, Peru and Nicaragua are reported to be weighing the same move.

The diplomatic drive for recognition is part of a two-year plan by Salam Fayyad, the Palestinian prime minister, to establish all the institutions and attributes of statehood by the middle of 2011.

Analysts say this is the build-up to appealing for recognition by the UN General Assembly by September 2011.

Fayyad said on Wednesday that the current Israeli government’s stated commitment to a two-state solution could not be relied upon, "given the erosion that has taken place".

Danny Ayalon, Israel’s deputy foreign minister, earlier dismissed recognition of the Palestinian State by several countries, without sovereignty or recognised borders, as being no more serious than clicking the "like" button on the social networking site Facebook.

Fayyad dismissed the comment, saying: "It does matter. International recognition of our right to live as free people on territory occupied in 1967, the right to statehood … is very important."

(Agencies via Aljazeera English)