Israeli media say Prime Minister Benjamin Netanyahu has told lawmakers that Israel will not totally freeze West Bank settlement construction.
They say Netanyahu also told a parliamentary panel that Israel will continue to build as usual in east Jerusalem.
Netanyahu reaffirmed his position a day before he is to meet with Washington's Mideast envoy.
Envoy George Mitchell is visiting the region to try to reach a compromise on settlements that would allow Israeli-Palestinian peace talks to resume. He has pushed for a settlement freeze to get talks back on track, though it appears unlikely Netanyahu will yield to the pressure.
The Palestinians say they won't resume negotiations until all Israeli construction stops in east Jerusalem and the West Bank.