"The ministry has given its green light for construction of 30 houses, in conforming with the promise given by the previous defence minister, Shaul Mofaz, to rehouse residents of some settlements in Gaza who were evacuated in 2005,'' a defence ministry spokeswoman said.

The decision marks the first time since 1992 that the Israeli authorities have officially authorised the construction of a new settlement in the occupied West Bank, the anti-settlement Peace Now watchdog group said.

Previously the Israeli authorities have approved the expansion of existing settlements in the West Bank.

In 2005, Israel dismantled all 21 settlements in the Gaza Strip and withdrew troops and settlers from the territory.

According to a spokeswoman for the group representing the West Bank settlers, the new settlement will be called Maskiot and built in the northern Jordan Valley.

Construction is due to begin within weeks and is expected to take two to three years to complete, the spokeswoman, Emily Amrusy said.

"There is no reason to rejoice at this decision as it is nothing more than the application of a promise made to those expelled from Gush Katif,'' she added, referring to the largest Gaza settlement bloc dismantled last year.

Peace Now slammed the decision.

Israel was meant to freeze all settlement construction in the West Bank.

The plan, however, has made meagre progress since its launch and Israel says it will not be bound by its commitments until the Palestinians put a halt to attacks.

All settlements in the West Bank, occupied by Israel since the 1967 Six Day War, are considered illegal under international law.

At present, 260,042 people are living in the 121 official settlements in the West Bank, excluding annexed east Jerusalem. There are also more than a 100 wildcat outposts.

Some 543 new housing units were built in the West Bank in 2006 in existing settlements, the housing ministry said today.

In September, the authorities invited bids for construction of 864 new housing units in West Bank settlements.