Israeli Prime Minister Benjamin Netanyahu has offered to hold direct talks with Palestinian leader Mahmoud Abbas at the UN General Assembly.
Mr Abbas earlier said he was willing to meet Mr Netanyahu but was determined to push ahead with a bid for UN recognition of a Palestinian state.The US and Israel oppose the bid and there has been intense diplomacy to avert a crisis over the move.
Peace talks between the Palestinians and Israel broke down a year ago.
The Palestinians are seeking international recognition of their state based on the borders that existed in 1967. This would give the Palestinians the West Bank, including East Jerusalem, and the Gaza Strip.
Israel and the US say a Palestinian state can only be achieved through direct negotiation, but the Palestinian leadership says this approach has got them nowhere.
Mr Abbas has said he will launch the process on Friday, when he submits a written request to UN Secretary General Ban Ki-moon after his address to the General Assembly.
If approved by Mr Ban, the Security Council then examines the request and votes on it. In order to pass, the request must get the votes of nine out of 15 council members, with no vetoes from the permanent members. The US has said it will use its veto.
In this case, Mr Abbas could ask for a vote of the General Assembly for enhanced observer status.
Symbolic value
Mr Netanyahu called on Mr Abbas - the President of the Palestinian Authority (PA) - to begin negotiations with Israel instead of "wasting time on unilateral moves".
He said: "I call on the PA chair to open direct negotiations in New York, that will continue in Jerusalem and Ramallah."
Analysts say the call is an attempt to stop Mr Abbas from launching his UN membership request.
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Palestinian UN Statehood Bid
- Palestinians currently have permanent observer entity status at the UN
- They are represented by the Palestine Liberation Organisation (PLO)
- Officials now want an upgrade so a state of Palestine has full member status at the UN
- They seek recognition on 1967 borders - in the West Bank, including East Jerusalem, and Gaza
- Enhanced observer member status could be an interim option
While UN recognition would have largely symbolic value, the Palestinians argue that it would strengthen their hands in peace talks with Israel, especially on the final status issues that divide them.
These are the precise location of the border, the status of Jerusalem, the right of return of Palestinian refugees, water, and security. Speaking on his way to New York, Mr Abbas said he was under "tremendous pressure" to drop his bid.
Diplomats have been meeting in New York after days of shuttle diplomacy in the Middle East to look for a compromise.
US Secretary of State Hillary Clinton said there was still time to reach one. But she said the "only way to a two-state solution... is through negotiations.
"No matter what does or doesn't happen this week, it will not produce the kind of result that everyone is hoping for," she said.
Representatives from the European Union, the UN, the US and Russia - the Quartet of Middle East mediators - are reported to be working on a framework for a return to talks that would forestall Mr Abbas' statehood bid.
The Jerusalem Post said this would have Israel agreeing "with reservations" to enter talks on the basis of the 1967 borders with mutual land swaps while the Palestinians would agree to the mention of Israel as the nation state of the Jewish people.
Israeli isolation
A BBC/GlobeScan poll suggests that in 19 countries across the world, more people back UN recognition of Palestine as an independent state than oppose it.
The Palestinian move at the UN comes as Israel is increasingly isolated in the Middle East.
Relations with Egypt, Turkey and Jordan have soured in recent months.
Mrs Clinton met Turkish Foreign Minister Ahmet Davutoglu in New York and made it clear to him that this was not the time for more tension and volatility in the region.
Turkey and Israel, once close partners, have fallen out since Israeli security forces raided a Turkish aid flotilla trying to reach Gaza last year, killing nine Turkish citizens.
Source: BBC News, 20 September 2011 Last updated at 01:13 GMT
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