The Obama administration, already on treacherous domestic political ground with its outreach to Iran, Cuba and others, has opened the door, if only slightly, to engagement with the militant group Hamas.
The Palestinian group is designated by the US government as a terrorist organisation and under law may not receive federal aid. But the administration has asked Congress for minor changes in US law that would permit aid to continue flowing to Palestinians in the unlikely event that Hamas-backed officials become part of a unified Palestinian government.
The aid measures may never come into play, given that power-sharing negotiations between Hamas and its rival, the US-backed Fatah faction, appear deadlocked. The two groups have been bitterly divided since 2007, when Hamas seized control of Gaza.
Nevertheless, the move has alarmed congressional supporters of Israel as they watch for any sign that the new White House might be more sympathetic to Palestinians than was the Bush administration.
The Obama administration's proposal is akin to agreeing to support a government that "only has a few Nazis in it", Illinois congressman Mark Kirk, a Republican, told US secretary of state Hillary Clinton last week.
The move underscores the quandary faced by the administration in its efforts to broker peace in the Middle East. President Barack Obama has repeatedly called for a separate Palestinian state. But negotiating a peace deal, or even distributing aid, will be difficult without dealing with Hamas, whose influence among Palestinians continues to grow.
The administration requested the changes this month as part of an $83.4bn emergency spending bill. The bill would provide $840m for the Palestinian Authority and for rebuilding in Gaza, after the 22-day Israeli military assault.
US officials insist the proposal does not mean they would be recognising or aiding Hamas. Under law, any US aid would require that the Palestinian government meet three longstanding criteria: recognising Israel, renouncing violence and agreeing to follow past Israeli-Palestinian agreements.
Hamas as an organisation does not meet those criteria. However, if the rival Palestinian factions manage to reach a power-sharing deal, the Obama administration wants to be able to provide aid so long as the Hamas-backed members of the government - if not Hamas itself - meet the three criteria.
The Bush administration disapproved of power-sharing and welcomed the collapse of a unity government in 2007.
Clinton, defending the administration's position last week before Congress, noted that the US supports and funds the Lebanese government, even though it includes members of Hezbollah, another militant group on the US terrorist list.
She argued that the US should try to gradually change the attitudes of Hamas members, as it did in Northern Ireland, where it help broker a peace deal.
"We don't want to ... bind our hands in the event that such an agreement is reached and the government that they are part of agrees to our principles," she said.
Discussions of a possible coalition government tend to focus on a team led by someone acceptable to the west, such as Palestinian prime minister Salam Fayyad, and staffed largely by nonpartisan technocrats.
Still, some lawmakers are reluctant to support or fund any government containing officials who carry the blessing of Hamas.
Congressman Adam Schiff, a Democrat from California, said the proposal sounded "completely unworkable", even if the individual Hamas-backed officials agreed to abide by the US conditions.
"You couldn't have the leadership of a terrorist organisation pick the ministers in the government, with the power to appoint and withdraw them, and answering to them," he said.
But Nathan Brown, a specialist in Palestinian politics at George Washington University, said it was significant that the administration was willing to approach Congress with the proposal.
Ziad Asali, president of the American Task Force on Palestine, a Washington group that advocates Palestinian statehood, saw the proposal as another of Obama's gestures to adversaries. "This is saying, 'I'm reasonable; I'm trying to make a start; don't say I haven't tried,' " Asali said.
International donors have been unwilling to authorise money for Gaza reconstruction in the absence of a unified Palestinian government, and salaries of many government employees have gone unpaid.
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