"We are building and we will continue to build," Israeli Prime Minister Benjamin Netanyahu wrote in a Facebook post. The Trump White House had no immediate comment. Its response could set the tone for the next four years of Mideast diplomacy.
While Trump has signaled that he will be far more tolerant of Israeli settlement construction than his predecessors, he also has expressed a desire to broker a peace accord between Israel and the Palestinians, and siding closely with Israel on such a contentious matter could hurt US credibility.
Those tensions boiled over last month when the Obama White House allowed the UN Security Council to pass a resolution condemning the settlements as illegal.
Trump harshly criticised Obama for going against Israel and promised a new approach after taking office, raising hopes inside Israel's nationalist government for a new era in relations.
Trump has already invited Netanyahu to visit the White House next month, and both men, after speaking on the phone Sunday, promised close coordination on a range of sensitive matters.
The construction plans were announced by Defense Minister Avigdor Lieberman, who said in a statement that he and Netanyahu agreed on the approval "in response to housing needs."
He said most of the housing units will be built in settlement "blocs," densely populated areas where most settlers already live and which Israel wants to keep under its control under any future peace deal with the Palestinians.
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