Israel's PM Benjamin Netanyahu has moved to ease tensions with the US, describing the two countries' relations as those of "allies and friends".
Mr Netanyahu also dismissed reports one of his confidants called US President Barack Obama a "disaster" for Israel.
The US has criticised the building of Jewish homes in East Jerusalem, which prompted the Palestinians to pull out of US-brokered indirect peace talks.
The row has caused one of the worst crises in US-Israeli ties for decades.
It has also led to increased tensions between Israel and the Palestinians, with Palestinian Authority President Mahmoud Abbas ruling out talks with Israel unless it halts the construction of settlements in occupied territory.
Some leaders at an Arab League summit in Libya echoed Mr Abbas's position in a statement on Sunday, saying negotiations could not resume unless Israel stopped all settlement building.
Meanwhile, the US is considering abstaining from a possible UN Security Council resolution against Israeli settlement expansion in East Jerusalem, the BBC has learned.
The US usually blocks Security Council resolutions criticising Israel.
In the wake of a controversial visit to the US, Mr Netanyahu said on Friday that his policy on East Jerusalem would not change, despite US pressure on Israel to announce a freeze on building Jewish homes there.
A best-selling Israeli newspaper then quoted an unidentified aide as saying: "You could say that Obama is the greatest disaster for Israel - a strategic disaster."
But the prime minister, speaking before he briefed the cabinet on his US trip, condemned these comments as "unacceptable".
"They do not come from anyone representing me. The relations between Israel and the United States are those of allies and friends, and are based on tradition spanning many years."
Tension has also been mounting in Gaza in recent days, with two Israeli soldiers and two Palestinian militants reportedly killed in the worst clashes for more than a year.
At the cabinet meeting, Mr Netanyahu stressed that Israel would provide a "firm and decisive" response to any attack from the Palestinian militant group Hamas.
Israel pulled out in 2009 after an offensive which left hundreds of people dead.
Israel insists that Jerusalem will remain its undivided capital.
Nearly half a million Jews live in more than 100 settlements built since Israel's 1967 occupation of the West Bank and East Jerusalem.
They are considered illegal under international law, although Israel disputes this.
The Middle East quartet - the US, EU, UN and Russia - has called for final status negotiations to reach a comprehensive peace deal within two years.
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