Former US president Jimmy Carter warned during a visit to Jerusalem on Monday that the prospect of Israeli-Palestinian peace is "vanishing."
Mr Carter called the current situation "catastrophic" and blamed Israel for the growing isolation of east Jerusalem from the West Bank.
He said a Palestinian state was becoming "unviable."
"We've reached a crisis stage. The two-state solution is the only realistic path to peace and security for Israel and the Palestinians."
Mr Carter is leading a delegation known as the The Elders, which includes former Irish president Mary Robinson and former Norwegian prime minister Gro Harlem Brundtland.
They met Israeli President Shimon Peres and Palestinian President Mahmoud Abbas.
The delegation expressed concern about the ongoing division between the main Palestinian parties, Fatah and Hamas, and vowed to support Palestine's bid for observer-state status at the United Nations General Assembly in November.