Israel has approved the construction of 277 new housing units in a Jewish settlement located deep in the occupied West Bank.

Israel's Defense Ministry said Monday that Defense Minister Ehud Barak approved the new housing in the Ariel settlement. It said Israel would reserve at least 100 of those units for Israelis evacuated from Gaza in 2005.

The move comes less than a week after Israel's Interior Ministry gave final approval for a plan to build 1,600 new homes for Jewish residents in East Jerusalem. Officials also said they expect to approve the construction of another 2,700 houses in the city soon.

The ministry's spokesman said the housing plans address the recent protests about the high cost of living and calls for more affordable housing in Israel.

In Washington, the U.S. State Department called the Israeli decision “deeply troubling.” Last week, the White House urged Israelis and Palestinians not to take any action that would make it harder for the two sides to negotiate a peace settlement.

Palestinians want East Jerusalem as the capital of a future state and have refused to resume peace talks unless Israel stops building in East Jerusalem and the West Bank.

Palestinian President Mahmoud Abbas is lobbying U.N. members to recognize a Palestinian state on the entire West Bank, the Gaza Strip and East Jerusalem, areas that Israel captured in the 1967 war. Israel withdrew from Gaza in 2005.