File Photo: A construction worker in the Har Homa neighborhood in east Jerusalem, Feb. 14, 2017. AP
Peace Now said the construction of the homes would largely cut off the city from the southern part of the occupied West Bank, further complicating any efforts to create a functioning Palestinian state.
The United States has repeatedly urged Israel to refrain from settlement construction.
The projects were approved by a municipal committee and will be considered by a district committee on Jan. 17. It would likely be years before any construction takes place, but Peace Now says once the approval process is underway, it becomes increasingly difficult to stop.
One plan would build 1,465 housing units between Givat Hamatos and Har Homa, two especially controversial settlements, further cutting off east Jerusalem from the Palestinian city of Bethlehem and the southern West Bank.
Another 2,092 homes would be built elsewhere in east Jerusalem.
Israel captured east Jerusalem and the West Bank in the 1967 Mideast war, territories the Palestinians want for their future state.
Israel annexed east Jerusalem in a move not recognized internationally and views the entire city as its capital. It considers the West Bank to be the biblical and historical heartland of the Jewish people.
Israel's current government, which includes parties from across the political spectrum, has ruled out any major initiatives to resolve the decades-old conflict but has taken limited steps to improve living conditions in the occupied territories.
The Jerusalem municipality says it is committed to building in all parts of the city for the benefit of Jewish and Arab residents.
But discriminatory policies make it nearly impossible for Palestinians to legally build new homes or expand their neighborhoods, while Israel encourages the expansion of settlements intended for Jewish residents.
Authorities are advancing ``far-reaching plans that post facts on the ground that undermine the possibility of peace,'' Peace Now said in a statement.
A similar plan to build some 9,000 housing units on the site of an abandoned airport in east Jerusalem was placed on hold late last year.
The Palestinians view settlements in east Jerusalem and the occupied West Bank as a major obstacle to peace.
Most of the international community _ which overwhelmingly supports a two-state solution to the conflict _ considers the settlements to be a violation of international law.
The last serious peace negotiations broke down more than a decade ago.