The UN Security Council on Friday demanded that Israel halt its settlement activities in Palestinian territory, in a resolution adopted after the United States refrained from vetoing the measure condemning its closest Middle East ally.
In a rare step, the United States instead abstained, allowing the measure to pass by a vote of 14-0 in the 15-member council.
Applause broke out in the council chamber after the adoption of the resolution, the first measure on the Middle East passed at the council in eight years.
The vote was scheduled at the request of four countries — New Zealand, Malaysia, Senegal and Venezuela — who stepped in to push for action after Egypt on Thursday put the draft resolution on hold.
Egyptian President Abdel Fattah al-Sisi had backtracked on the move to condemn Israel's settlement policy after receiving a phone call from US President-elect Donald Trump, who spoke out in favour of a US veto.
Israeli Ambassador Danny Danon said his government had expected a US veto of "this disgraceful resolution."
"I have no doubt that the new US administration and the incoming UN secretary general will usher in a new era in terms of the UN's relationship with Israel," said Danon.
The resolution demands that "Israel immediately and completely cease all settlement activities in the occupied Palestinian territory, including East Jerusalem."
It states that Israeli settlements have "no legal validity" and are "dangerously imperiling the viability of the two-state solution" that would see an independent Palestine co-exist alongside Israel.
Israeli settlements are seen as a major stumbling block to peace efforts, as they are built on land the Palestinians see as part of their future state.
The United Nations maintains that settlements are illegal, but UN officials have reported a surge in construction over the past months.
Some 430,000 Israeli settlers currently live in the West Bank and a further 200,000 Israelis live in east Jerusalem, which the Palestinians see as the capital of their future state.