Israeli Prime Minister Benjamin Netanyahu was due in Berlin on Wednesday for talks likely to focus on the growing crisis over settlement plans that could torpedo the viability of a Palestinian state.

Ahead of his departure on a trip that will take him briefly to Prague and then on to Berlin, Netanyahu brushed off the diplomatic pressure.

He insisted that Israel's settlement building was not the central issue in the decades-long conflict between the Jewish state and the Palestinians.

"The root of the conflict is not the settlements; it is the very existence of the state of Israel and the desire to wipe it off the face of the earth," he said late on Tuesday.

"Our top public diplomacy mission is to explain that the root of this conflict is not territorial. It is over our very existence in any borders whatsoever."

Israel is facing mounting international pressure over its announcement that it will build 3,000 new settlement homes, including in an area east of Jerusalem, where observers say construction could crush hopes of a viable Palestinian state.

It announced the plans in response to the General Assembly's decision last week to upgrade Palestinian UN status.

On Tuesday night, the Palestinian leadership said it would ask the UN Security Council to condemn the Israeli settlement programme.

The leadership decided "as a first measure to turn to the UN Security Council... to request a constraining resolution for Israel to stop its decisions of destructive expansion and all forms of settlement."

The decision came after a chorus of disapproval from the international community, including the European Union, although Britain said on Tuesday that the grouping was unlikely to punish Israel by imposing trade sanctions.

Germany said it was "deeply concerned" about the Israeli plans and urged the Jewish state to reverse its decision.

"Both sides should act constructively and avoid obstructing what is urgently needed, namely the resumption of substantial direct peace talks," German government spokesman Steffen Seibert said on Monday.

France, Britain, Spain, Denmark, Sweden, Australia and Egypt have all summoned the Israeli ambassadors to protest the plans, which also drew criticism from Russia and Japan.

The site of the controversial new construction, known as E1, lies between the easternmost edge of annexed east Jerusalem and the nearby Maaleh Adumim settlement.

Observers say Israeli settlement there would effectively prevent the future establishment of a contiguous Palestinian state, dooming the two-state solution.

Washington has also warned construction in E1 "would be especially damaging to efforts to achieve a two-state solution" and President Barack Obama's spokesman urged Israel "to reconsider".

EU's ambassador to Israel, Andrew Standley, said on Tuesday that despite growing international calls, Israel had shown no sign it was planning to call off its construction plans.

"We've not had any signal or message back, for the time being, to indicate that this message has been heard and has been acted upon," he said.

"There have been in fact, to the contrary, further messages or announcements saying Israel will act upon what it considers to be its strategic interests, which may suggest that if it sees more measures as necessary it will take more measures," he said.

"This is not what we are asking for."

A source in Netanyahu's office stressed on Monday there would be "no change" to the decision.

Since then the Israeli government, which is in election mode, has announced it will revive plans for another 1,600 settlement homes in annexed east Jerusalem.

E1 is a corridor of West Bank land which runs between the easternmost edge of annexed east Jerusalem and the nearby Maaleh Adumim settlement.

The Palestinian leadership held a meeting in Ramallah chaired by president Mahmud Abbas and attended by a top Hamas official.

It decided "as a first measure to turn to the UN Security Council... to request a constraining resolution for Israel to stop its decisions of destructive expansion and all forms of settlement."

The international outcry since Friday's move has been intense, with UN chief Ban Ki-moon warning that building in E1 would deal the two-state solution "an almost fatal blow".

Washington has warned construction in E1 "would be especially damaging to efforts to achieve a two-state solution" and President Barack Obama's spokesman urged Israel "to reconsider".

Israel has not given a time frame for the new construction, which has drawn praise from hardliners.

"History proves that every time we insisted on our positions and were prepared to clash, the West has always capitulated, because justice was ours," said the pro-Netanyahu daily Israel HaYom.

"The 3,000 housing units are a first and very modest step. More will follow. Fear not, Israel."