For all latest news, follow The Financial Express Google News channel.
The US imposed sanctions on Palestinian Authority officials and members of the Palestine Liberation Organization on Thursday, accusing them of undermining peace efforts with Israel even as other Western powers moved toward recognition of Palestinian statehood.
The State Department said it would deny visas for travel to the US by those it was targeting, although it did not name any specific individuals.
"It is in our national security interests to impose consequences and hold the PLO and PA accountable for not complying with their commitments and undermining the prospects for peace," the State Department said in a statement, according to a Reuters report.
The State Department said the two Palestinian organisations had "taken actions to internationalise" their conflict with Israel, including through the International Criminal Court, and said both had continued "to support terrorism."
The PA and PLO serve as representatives for the Palestinian people and have long pushed for recognition of a Palestinian state by international organisations and foreign nations. The two groups had no immediate comment on the US move.
There are signs of a growing diplomatic divide over Palestinian statehood between Washington and three fellow Group of Seven allies.
Late on Wednesday, Canada said it planned to recognise the State of Palestine at a meeting of the United Nations in September, ratcheting up pressure on Israel as starvation spreads in the Palestinian enclave of Gaza.
France said last week it would back Palestinian statehood, and Britain said on Tuesday it would do the same at September's UN General Assembly meeting if the fighting in Gaza had not stopped by then.
US President Donald Trump has insisted that recognition of Palestinian statehood would wrongly reward Hamas, the militant group that is battling Israel in the Gaza Strip. Since returning to office in January, he has been vague about his position on a two-state solution to the conflict between Israel and the Palestinians.