The British government says Israel's expropriation of a large swath of land inside the occupied West Bank would "do serious damage to Israel’s standing in the international community."
On Sunday, Israel laid claim to about 400 hectares in the area of Gush Etzion near Bethlehem in what critics say is Israel’s biggest land grab in at least 30 years.
"The U.K. deplores the Israeli government's move," British Foreign Secretary Philip Hammond said, adding that "the priority must be to build on the cease-fire in Gaza."
The U.S. State Department on Sunday called for Tel Aviv to reconsider its decision and said taking the land would be "counterproductive" to peace efforts in the region.
Land seizure "is counterproductive to Israel’s stated goal of a negotiated two-state solution with the Palestinians," said a senior official, who requested anonymity.
Since President Barack Obama took office in 2009, his administration has made clear its opposition to settlement expansion. It is the latest stumbling block in the relationship with Israeli Prime Minister Benjamin Netanyahu.
Egypt denounces claim
On Monday, Egypt’s foreign ministry also decried the move. Egypt last week brokered the truce halting the 50-day war between Israel and Hamas, which killed more than 2,100 Palestinians and 68 Israelis and left parts of the Gaza Strip in ruin.
"This is not a positive step. It contradicts international law and will have negative consequences on the peace process," a statement from Cairo said, according to the AFP news service.
Chief Palestinian negotiator Saeb Erekat condemned the move as part of what he calls Israeli crimes against the Palestinian people and their occupied land.
Israel's army said it declared the land "state-owned" under orders from political leaders. It is in reaction to the June kidnapping and murders of three Israeli teenagers near Bethlehem.
Israel has named three Palestinians as suspects. The murders and the revenge killing of a Palestinian teen by Israelis helped spark the recent fighting between Israel and Hamas in Gaza.
Some information for this report was provided by the AFP news service.