The Duke of Cambridge will visit the Palestinian Territories as part of a wider tour of the Middle East, which includes Israel and Jordan, in the summer.
William, 35, third in line to the British throne, will travel without his wife and children, with further details of the visit to be unveiled at a later stage.
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The visit, seen as a significant diplomatic move, is designed to promote cultural and diplomatic ties with the region, with William expected to spend some time with senior politicians and visit local charities.
It marks the first official royal visit to Israel, which was welcomed by Israeli Prime Minister Benjamin Netanyahu.
"We welcome the announcement on the arrival of Prince William to Israel. This is a historic visit, the first of its kind, and it will be greeted here with great affection," Netanyahu said.
"I have instructed the Foreign Ministry director general to coordinate the preparations ahead of the visit in order to ensure its success," he said.
Israeli President Reuven Rivlin tweeted that the arrival of Prince William on the country's 70th anniversary of independence was a "very special present".
The visit to the Palestinian Territories is at the invitation of Palestinian President Mahmoud Abbas.
Philip Hall, British Consul General to Jerusalem, said: "I am delighted that Prince William has accepted President Abbas' invitation to visit the occupied Palestinian Territories in the summer.
"This will be a unique and special opportunity for His Royal Highness to meet Palestinian people and see the reality of life in the Holy Land. I know he is looking forward to the visit enormously".
Last year, it was reported that there were plans for William's father Prince Charles to visit Israel in an official capacity but the trip was reportedly cancelled over fears it could anger the UK's Arab allies.
The decision to send William, who took over full-time royal duties last year, marks a careful diplomatic move to keep all sides happy.
UK Foreign Office minister Alistair Burt said it was an "important and unique opportunity to promote diplomatic and cultural ties in the region".
The visit will mark the most diplomatically sensitive visit yet for Prince William, whose recent overseas tours have included Canada, Germany, Poland, Denmark, Norway and Sweden.
His great-grandmother and mother of Prince Philip, Alice, is buried in Israel.
Prince Charles has paid unofficial visits to the region for the funerals of Israeli leaders Yitzhak Rabin and Shimon Peres, and his father, Prince Philip, went in a private capacity in 1994 to visit the grave of his mother.
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