Israeli Prime Minister Benjamin Netanyahu plans to allow construction in the Judea and Samaria (the West Bank) to resume.
The 10-month freeze on new housing there is set to expire at the end of September.
Netanyahu said he will let that happen, at least partially.
Israeli settlement construction is a key point in newly launched peace talks.
Netanyahu and Palestinian President Mahmound Abbas are set to have their second round meetings Tuesday in Egypt.
Secretary of State Hillary Clinton will also be joining them.