The international group of mediators on the Middle East, known as the quartet, has agreed on a new way to get direct aid to the Palestinians.
Most foreign assistance has been frozen since the success of the militant group, Hamas, in the Palestinian elections.
Payments were frozen in response to the Hamas-led administration's refusal to acknowledge Israel's right to exist and to renounce violence.
Coupled with Israel's earlier decision to stop handing over customs duties that it collected on behalf of the Palestinian Authority, the suspension of aid has left the government unable to pay salaries in March and April for its 160,000 employees.
It was feared that more pressure on the Hamas-led administration could cause the Palestinian government to collapse, unleashing a deeper humanitarian and security crisis in the West Bank and Gaza.
After a series of meetings in New York, the US bowed to pressure on the issue from Russia, the European Union and the United Nations.
The quartet said the EU would take the lead in working out the details - with a meeting due to be held in Brussels next week to discuss the aid plan.
Need for negotiated settlement emphasised
Hamas has welcomed moves to resume aid payments but expressed anger at the continued political boycott of the regime.
The new Israeli government has threatened to move ahead with its plan to unilaterally fix its final borders by the end of the year unless Hamas changes its platform.
However, the quartet emphasised its desire for a negotiated settlement to the Middle East conflict under the framework of the internationally-backed roadmap, a peace plan which has made next to no progress in the three years since its launch.
