"We condemn Israel's approval of the construction of 560 additional units at the illegal settlements on the Palestinian territories that it keeps under occupation," Turkish foreign ministry said.
The approval is an another indication of Israel's disregard for the international law and community despite the UN Security Council Resolution 2334, which condemned the illegal settlement activities, and "put on record that such activities destroy the ground for the two state solution," the statement added.
Israeli authorities approved 560 settlement homes in occupied East Jerusalem on Sunday, reported Israel Radio.
The move came only two days after new U.S. President Donald Trump was inaugurated.
The radio quoted Meir Turgeman, the Jerusalem Planning and Building committee's chairman, as saying the permits had been delayed as they awaited Barack Obama's departure from office.
After an often tense relationship between Obama and Israeli Prime Minister Benjamin Netanyahu over Israel's settlement policy, Israeli politicians have hoped Trump might offer more support despite the settlements being illegal under international law.
Netanyahu said during his weekly cabinet meeting on Sunday that he and Trump would speak by phone for the first time later in the day about the Palestine-Israel conflict, the Syrian civil war and the Iranian nuclear deal.
"On the issue of settlement, none are more concerned about it than the Likud government and I, and we will continue to look out for it wisely and responsibly, for the benefit of the settlement enterprise and the State of Israel."
Trump's stance on the Palestine-Israel conflict has been controversial because of suggestions from his camp they would move the U.S. embassy to Jerusalem, a move which would mean recognizing the city as Israel's capital, contrary to the international consensus.
Israeli newspaper Yedioth Ahronoth reported Sunday that Trump's chosen ambassador for Israel, David Friedman, plans to live in Jerusalem rather than the official residence in the city of Herzliya, near Tel Aviv.