Secretary of State Hillary Rodham Clinton on Friday urged Palestinians and Israelis to plunge into negotiations over the most difficult issues dividing them as a way of breaking an impasse in peace talks.

Clinton said negotiations on major issues, such as the borders of a future Palestinian state or the status of Jerusalem, would help defuse the dispute over the growth of Jewish settlements in the West Bank that has obstructed progress toward peace.

"Resolving borders resolves settlements," Clinton said at the State Department. "Resolving Jerusalem resolves settlements."

Her comments came after a round of meetings with Egyptian and Jordanian officials who are looking for a way to revive the stalled American-backed peacemaking effort.

"We need to lift our sights and instead of . . . looking down at the trees, we need to look at the forest," she said.

Former Sen. George Mitchell, the special envoy for Mideast peace, is about to make another trip to the region.

U.S. officials have been talking with Israelis and Palestinians to outline principles and goals for peace talks in the hope of bringing them back to the negotiating table.

But a remaining obstacle is Palestinian Authority President Mahmoud Abbas' refusal to begin negotiations without a complete freeze in Israeli settlements in the West Bank.

Abbas adopted that position last year, when U.S. officials tried but failed to persuade Israelis to impose a full halt to settlement growth in the West Bank.

Ziad Asali, president of the Washington-based American Task Force on Palestine, said the purpose of the recent rounds of meetings has been "to bring the parties to negotiations without a loss of face for anybody."

paul.richter@latimes.com