The UN Security Council on Thursday delayed a contentious vote on a draft resolution demanding that Israel halt settlements as President-elect Donald Trump weighed in and said the United States should veto the measure.

Egypt requested that the vote be postponed, one day after submitting the draft text to the council, a move that triggered immediate calls from Israeli Prime Minister Benjamin Netanyahu for a US veto to block the resolution.

A similar resolution was vetoed by the United States in 2011, and it remained unclear whether Washington would shift stance this time, possibly abstaining to allow the measure to pass, although without US support.

"Israelis deeply appreciate one of the great pillars of the US-Israel alliance: the willingness over many years of the United States to stand up in the UN and veto anti-Israel resolutions," Netanyahu said.

"I hope the US won't abandon this policy."

Israel launched a frantic lobbying effort to pressure Egypt to drop the bid and reached out to its supporters in the United States and at the Security Council for support.

Israeli Ambassador Danny Danon said his government was deploying "diplomatic efforts on all fronts to ensure that this disgraceful resolution will not pass in the Security Council."

A UN diplomat, speaking on condition of anonymity, dubbed the Israeli lobbying a "diplomatic World War III" and a senior Security Council diplomat suggested that the motion could be buried indefinitely.

"There was a window of opportunity. Whether that window is still there is really not clear," said a Western diplomat.

- Trump calls for US veto -
Trump, who campaigned on a promise to recognize Jerusalem as Israel's capital, bluntly said Washington should use its veto to block the resolution.

"The resolution being considered at the United Nations Security Council regarding Israel should be vetoed," he said in a statement.

"As the United States has long maintained, peace between the Israelis and the Palestinians will only come through direct negotiations between the parties, and not through the imposition of terms by the United Nations," he said.

"This puts Israel in a very poor negotiating position and is extremely unfair to all Israelis."

Palestinian ambassador Riyad Mansour said Trump's call for a veto was in response to pressure from the Israeli prime minister. "He is acting on behalf of Netanyahu," he said.

Trump has chosen as ambassador to Israel the hardliner David Friedman, who has said Washington will not pressure Israel to curtail settlement building in the occupied West Bank.

No new timeframe was announced for the vote, which had been scheduled for Thursday afternoon.

Arab ambassadors held an emergency meeting at the United Nations to press Egypt to move ahead with a vote but an Arab League committee decided after meeting in Cairo to continue talks on the fate of the motion.

Palestinian envoy Jamal al-Shobaki told reporters in Cairo that Egypt asked for more time and that there would be discussions over the next two days on the next step.

Illustrating how the Egyptian decision caught Washington flat-footed, Secretary of State John Kerry cancelled plans to make remarks laying out a vision for the Israeli-Palestinian peace process.

Kerry spoke to Egyptian Foreign Minister Sameh Shoukry on Wednesday and then, after the Egyptian decision, to Netanyahu on Thursday.

President Barack Obama's administration has expressed mounting anger over the continued expansion of the Jewish outposts and speculation has grown that he could launch a final initiative before leaving.

- Saving the two-state solution -
Israeli settlements are seen as a major stumbling block to peace efforts, as they are built on land the Palestinians see as part of their future state.

The United Nations maintains that settlements are illegal, but UN officials have reported a surge in construction over the past months.

The draft resolution demands that "Israel immediately and completely cease all settlement activities in the occupied Palestinian territory, including East Jerusalem."

It states that Israeli settlements have "no legal validity" and are "dangerously imperiling the viability of the two-state solution" that would see an independent Palestine co-exist alongside Israel.

The Middle East peace process has been comatose since a US initiative to re-launch peace talks collapsed in April 2014.

France announced plans to host an international conference on January 15 to try to restart talks based on the two-state solution.