Hanan Ashrawi, a veteran Palestinian negotiator and member of the Palestine Liberation Organization's Executive Committee, said on Twitter before Pompeo's statement, that the move represented another blow to "international law, justice & peace".
But for Palestinians, the decision was only the latest shake-up of American policy under President Trump that has tainted Washington's standing as a mediator, including his shift of the U.S. Embassy from Tel Aviv to Jerusalem in May 2018.
The pass upends more than 40 years of USA policy that has declared Israeli expansion into territories occupied since the 1967 war a vital obstacle to settling the Israeli-Palestinian war.
The move Monday is the latest step by Trump embraced by Netanyahu, who praised Pompeo's statement, saying it righted an historic wrong.
"What we did here was conduct a legal analysis".
Israel also captured East Jerusalem in 1967, and annexed it. Each and each areas are claimed by Palestinians for a future teach.
"The EU calls on Israel to end all settlement activity, in line with its obligations as an occupying power", EU foreign policy chief Federica Mogherini said in a statement following the U.S. move.
Yet, US President Donald Trump is still determined to roll out his "deal of the century" that presupposes concessions from both Israelis and the Palestinians in exchange for a series of financial and diplomatic benefits.
Erekat called on the advisors of the U.S. administration "to review the provisions of global laws". The recently passed Jewish Nationality Act enshrining Jewish supremacy provides the legal foundation for such a state.
Sad to see Trump administration argue that Israeli settlements are not illegal. He called on other countries to take the same position as the White House.
Most of the world views the expansion of Israeli settlements as an impediment to a peace agreement.
He noted, however, that this announcement should not be viewed as the USA government "addressing or prejudging the ultimate status of the West Bank".
He further noted that the ultimate status of these neighbourhoods must be decided by Israelis and Palestinians.
It's an uncertain time in Israeli politics. They were rankled not just by the substance of Pompeo's departure from 40 years of US policy, but also by the scriptural language that some supporters of the shift used to justify it.
For peace and stability: Then-US president Barack Obama speaks during a working dinner with ASEAN leaders on the sidelines of the ASEAN-US Summit in California, United States, on February 18, 2016. "Because there could be a shift in the government in Israel".
"Calling the establishment of civilian settlements inconsistent with global law has not advanced the cause of peace", Pompeo told reporters at the State Department.
Ayelet Shaked of the nationalist Yamina (New Right) tweeted, "Thank you President Trump and Secretary Pompeo for recognizing that there is nothing illegal about Jewish communities in Judea & Samaria".
Jews had lived in portions of Judea and Samara for millennia.
"This is for the Israelis and the Palestinians to negotiate", he said, saying the US decision was not meant "to compel a particular outcome nor create any legal obstacle to a negotiated resolution".
Avi Bell, senior fellow at the right-wing Kohelet Policy Forum in Israel, said the announcement would strengthen Israel in defending settlement construction.
"Netanyahu is trying to form a coalition, but no one knows what will happen tomorrow", said Revivi. Netanyahu will most doubtless be widely anticipated to be indicted on corruption rate in coming weeks, if no longer days.
The only two Arab states to have signed peace treaties with Israel - Egypt and Jordan - also sharply criticised the U.S. policy shift, with Jordanian Foreign Minister Ayman Safadi warning of its "dangerous consequences".