Israel’s Defence Minister Ehud Barak has approved permits to build 366 new settler homes in the occupied West Bank.
It is the first such authorisation since Benjamin Netanyahu's right-leaning government took office in March.
In a statement, the Defence Ministry said Mr Barak planned to issue more permits soon and raise to 450 the total number of new homes to be built.
The move - which comes just days ahead of a planned visit to the region by US Middle East envoy George Mitchell - is likely to spark criticism from Palestinians as well as in the US and Europe.
They have already warned that it could endanger a resumption of peace talks with the Palestinians.
Israel's Prime Minister Benjamin Netanyahu has said he would approve a burst of settlement construction before considering a US-demanded halt.