European nations began sending messages of concern and displeasure via Israeli ambassadors, on Saturday.
Prime Minister Benjamin Netanyahu said, "We will carry on building in Jerusalem and in all the places that are on the map of Israel's strategic interests".
On Friday, Israel announced that it would build new homes for three thousand people.
They will be built in an area east of Jerusalem, and fill the last gap between Jerusalem and the West Bank.
Israel had been holding off construction, in that area, for over a decade, mostly due to US pressure.
But after Thursday's UN recognition of Palestine as a state, they felt there was no choice left to them.
While the US has not condemned the move, they have reiterated their opinion that building in that area would be a bad idea.
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