Israeli Prime Minister Benjamin Netanyahu has rejected a reported US request that a building project in Jerusalem be halted.
The project involves building 20 apartments in the mainly Arab East Jerusalem area, which was captured by Israel in 1967.
Last week US officials told the Israeli ambassador that the project should be suspended, Israeli media said.
But Mr Netanyahu rejected this in comments at his weekly Cabinet meeting.
“We cannot accept the idea that Jews will not have the right to live and buy (homes) anywhere in Jerusalem,” he said.
“Unified Jerusalem is the capital of the Jewish people and the state of Israel. Our sovereignty over it is unquestionable.”
Israel has occupied East Jerusalem since 1967. It has annexed the city and declared its east and west Israel’s eternal capital.