The office of Israeli Prime Minister Benjamin Netanyahu says he will leave for Egypt early next week for talks with President Hosni Mubarak.
The two leaders are expected to discuss such issues as reviving Israeli-Palestinian peace talks, settlement construction and the release of an Israeli soldier held by Hamas.
Peace negotiations between the Israelis and Palestinians have stalled due to disagreements mainly on the issue of West Bank settlement construction.
On Monday, Israeli Defense Minister Ehud Barak approved construction of 455 new homes in West Bank settlements, a move Palestinian President Mahmoud Abbas said will ruin efforts to re-start peace talks.
The Obama administration has called on Israel to freeze all settlement construction. Israel says building within existing settlements is necessary to accommodate what it calls natural growth.
On Saturday, the exiled leader of Hamas, Khaled Meshaal, met with Egyptian intelligence chief Omar Suleiman in Cairo on a possible prisoner exchange deal with Israel.
Egypt has mediated the negotiations since Hamas gunmen captured Israeli soldier Gilad Shalit more than three years ago. Hamas representatives say the talks have gained momentum since German mediators got involved, making 11 trips to Gaza in the past month.
But Osama Hamdan, a Hamas official said the German mediation does not mean a breakthrough is imminent because, he said, Israel refuses to accept conditions set down by Hamas.
Hamas is demanding the release of about 1,000 Palestinian prisoners in exchange for Shalit, who is being held in the Gaza Strip.
Some information for this report was provided by AFP.