Israel has allowed its halt in construction of Jewish settlements in the occupied West Bank to expire, defying a US call to extend the moratorium and risking a Palestinian withdrawal from peace talks.
Minutes after the moratorium expired, Israeli Prime Minister Benjamin Netanyahu urged Palestinian President Mahmoud Abbas to continue "expedited, honest talks" to achieve a peace agreement within a year.
"Israel is ready to pursue continuous contacts in the coming days to find a way to continue peace talks between Israel and the Palestinian Authority," he said in a statement.
The Israeli leader has resisted calls from US President Barack Obama to extend the construction freeze but the United States has said it is trying to ensure both sides continued to negotiate despite Israel's decision.
Netanyahu, whose governing coalition is dominated by pro-settler parties, earlier urged Jewish settlers to show restraint before the freeze ended at midnight.
But settler leaders have said they will begin erecting next week some 2,000 homes in the West Bank.