US President Barack Obama aims to halt construction completely in east Jerusalem, including the strictly Orthodox neighbourhood of Ramat Shlomo, as part of 10 demands made during his Washington meeting with Israeli Prime Minister Binyamin Netanyahu, Israel media has reported.
Other demands include ending the demolition of Palestinian neighbourhoods and the re-starting of indirect talks with the Palestinians to decide on future borders.
But Israelis fear that indirect talks would give the American mediators an advantage in influencing the discussion, as it could mean direct talks are bypassed entirely.
Palestinian President Mahmoud Abbas has refused to conduct indirect talks until there is a building freeze in east Jerusalem.