The United States on Monday urged Israelis and Palestinians to work in good faith and make "compromises" ahead of the first direct talks in three years chasing a long-elusive peace deal.
US Secretary of State John Kerry named seasoned diplomat Martin Indyk as the US special envoy to the talks, charged with shepherding the parties through nine months of tough negotiations.
Talks were to start later Monday with an iftar dinner hosted by Kerry with Israeli chief negotiator Tzipi Livni and her Palestinian counterpart Saeb Erakat.
President Barack Obama welcomed the imminent start of the talks, calling it a "promising step" forward but warning that "hard choices remain ahead."
"The most difficult work of these negotiations is ahead, and I am hopeful that both the Israelis and Palestinians will approach these talks in good faith," he said.
Obama promised that the United States is ready to support both sides "with the goal of achieving two states, living side by side in peace and security."
Speaking just hours before the first face-to-face public meeting since September 2010, Kerry again praised the courage shown by Israeli Prime Minister Benjamin Netanyahu and Palestinian leader Mahmud Abbas in agreeing to resume negotiations.
"Many difficult choices lie ahead for the negotiators and for the leaders as we seek reasonable compromises on tough, complicated, emotional and symbolic issues," he said.
"I think reasonable compromise has to be a keystone of all of this effort."
The two sides have agreed to continue talking for at least nine months, a State Department official said.
"They have agreed to work together through the course of that time," spokeswoman Jen Psaki said, but she cautioned this was not a deadline.
"We're going to make every effort to reach an agreement within that time frame, but again, if we're making progress and we're continuing to make progress, this is not a deadline."
Indyk, 62, who has twice served as US ambassador to Israel and participated in the failed 2000 Camp David summit under then president Bill Clinton, said he was taking on "a daunting and humbling" challenge.
But he insisted: "It has been my conviction for 40 years that peace is possible."
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The last direct talks collapsed in September 2010 amid continued Israeli settlement building.
Israel and the Palestinians remain deeply divided over so-called "final status issues" -- including the fate of Jerusalem, claimed by both as a capital, the right of return for Palestinian refugees, the borders of a future Palestinian state and the fate of dozens of Jewish settlements scattered across the occupied West Bank.
Earlier this month, on his sixth trip to the region in six months of dogged diplomacy, Kerry wrested an accord setting out the basis for new negotiations from both sides.
But Livni, speaking after meeting UN chief Ban Ki-moon in New York, said the path ahead was "going to be very tough and problematic."
"The meeting is to define what will come next in the negotiations," senior Palestinian official Hanan Ashrawi told AFP.
"There must be a timeline and commitment from both sides on what they'll agree about. We hope for something good."
As a first step, Israel said Sunday it would release 104 Palestinians imprisoned before the 1993 Oslo accords -- some of whom are said to have been involved in attacks on Israelis.
Psaki said the US welcomed the vote by the Israeli cabinet to agree to the prisoner release as a "positive step forward."
Erakat also welcomed the Israeli move. "We consider this an important step and hope to be able to seize the opportunity provided by the American administration's efforts," he told AFP.
But Israeli media on Monday lashed out at the decision. "The murderers will go free," thundered the front-page headline in the top-selling daily Yediot Aharonot.
Jerusalem Post diplomatic correspondent Herb Keinon predicted these "murderers will be hailed as heroes in Hebron and Ramallah and Jenin," and urged Palestinians to show they are serious about peace by not celebrating their release.
Israeli President Shimon Peres, on a visit to Latvia, hailed the resumption of peace talks.
"We want to establish a two-state solution of a Palestinian state beside the state of Israel, living in peace and friendship and bringing an end to all conflict, which is so necessary today for all the people in the Middle East," he said.
"The Middle East is in a stormy situation. We hope the Middle East will overcome its storm and land in a port of peace."