Israel's Prime Minister Benjamin Netanyahu has vowed not to bow to "pressure" from Washington, after US administration officials reportedly labelled him a "coward".
An article in The Atlantic magazine quoted unnamed White House officials condemning Mr Netanyahu for lacking political courage, his posturing over the Iranian nuclear issue, and for his commitment to the continued construction of illegal settlements in East Jerusalem and the West Bank.
The article is the latest sign of the apparently deteriorating relationship between the Israeli and US leaderships.
Officials in Mr Netanyahu's office said the Prime Minister would "continue to meet the security interests of Israel's citizens and the rights of the Jewish people in Jerusalem".
"No pressure will change that."
Israeli Economy Minister Naftali Bennett, the leader of pro-settler Jewish Home party, called on the Obama administration to reject the criticisms, which also described Mr Netanyahu as being "chickens***".
"Serious curses such as these towards the Prime Minister of Israel are hurtful to millions of Israeli citizens and Jews around the world," said Mr Bennett.
"If what was written is true, the current government is planning to throw Israel under the wheels of the bus. I call for the US government to renounce these provocative insults and reject them out of hand."
The article in The Atlantic comes days after reports the Israeli government is forwarding plans for the construction of a further 1,000 housing units in settlements in East Jerusalem.
Some 600 new units were penned for the Ramat Sholmo settlement in North East Jerusalem, and 400 in the Har Homa settlement, on the southern edge of the city.
Israeli settlements beyond the so-called "green line", which represents Israel's pre-1967 borders, are considered illegal under international law.
The Foreign Affairs Minister Charlie Flanagan has labelled the plan "illegal and unacceptable", and urged the Israeli government to reverse the decision.
Israel seized east Jerusalem during the 1967 Six-Day War and later annexed it - a move which has never been recognised by the international community.
The latest announcement prompted stern criticism from EU governments and the US.
US State Department spokeswoman Jen Psaki said: "We continue to make our position absolutely clear that we view settlement activity as illegitimate and unequivocally oppose unilateral steps that prejudge the future of Jerusalem."
But, speaking at the Israeli parliament on Tuesday, Mr Netanyahu said: "I've heard the claim that our construction in Jewish neighbourhoods in Jerusalem distances peace."
"It's this criticism that distances peace. These statements are detached from reality, they foster false statements by Palestinians."
Later the United Nations Security Council will discuss Israel's settlement announcements, following a request by Jordan.
Palestinian officials have warned the announcement of further settlement construction will fuel rising tensions in Jerusalem and the West Bank, where protests and violent incidents have been on the increase.
On Friday a Palestinian teenager was shot dead during protests.
Last week, a three-month-old Israeli baby was killed and several other people injured when a Palestinian man drove his car into a crowd waiting at a tram station.
Days earlier a 5-year-old Palestinian girl was run over and killed by an Israeli settler in the West Bank.
