Tel Aviv has repeatedly said the 10-month moratorium on building Jewish settlements in the occupied Palestinian territory is unlikely to be extended. Palestinians threaten to quit direct peace negotiations with Israel if the settlement construction moratorium ends.
"Israel must choose between peace and the continuation of settlements," Abbas told the UN General Assembly session.
He added that a halt to settlement construction was Israel's long-standing commitment, not an "arbitrary pre-condition" put forward by the Palestinians.
The issue of Jewish settlements has been one of the major sticking points that have prevented peace in the Middle East.
Egyptian Foreign Minister Ahmed Aboul Gheit also told the General Assembly that Israel would be to blame if peace talks fail over Tel Aviv's construction plans
"If Israel fails in its commitment to continue freezing its settlement activities, then it would expose the negotiation process to failure and it would shoulder full responsibility before the region and world public opinion," he said.
The Egyptian top diplomat added that the Israeli moratorium "has become a key element in determining Israel's intentions and how committed it is to the success of the negotiations."
Israeli-Palestinian direct peace talks came to a halt in December 2008, when Israel launched an attack on the Gaza Strip in a bid to put an end to the firing of homemade rockets at southern Israel by Palestinian militants based in the enclave. The negotiations resumed in the U.S. on September 2.
The Palestinians have cited ongoing Israeli settlement construction in the West Bank and East Jerusalem, both occupied by Israel since the 1967 Arab-Israeli War, as the main obstacle to the peace process.
The Palestinian National Authority said it may ask the UN Security Council to reestablish the 1967 border with Israel if direct Mideast talks fall through.
Earlier this week, the Middle East Quartet of negotiators, comprising Russia, the United States, the United Nations and the European Union, has also called on Israel to extend the moratorium.
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