The Palestinians are to ask the United Nations to upgrade their status to become a "non-member observer state" by the end of 2012.
It follows a failed bid to join the international body as a full member state in 2011 because of a lack of support in the UN Security Council.
Here is a guide to what is likely to happen and its significance.
What are the Palestinians asking for?
The Palestinians have long sought to establish an independent, sovereign state in the West Bank, including East Jerusalem, and the Gaza Strip - occupied by Israel during the 1967 Six Day War. The 1993 Oslo Accord between the Palestine Liberation Organisation (PLO) and Israel led to mutual recognition. However two decades of on-off peace talks have since failed to produce a permanent settlement. The latest round of direct negotiations broke down in 2010.
Recently, Palestinian officials pursued a new diplomatic strategy: asking individual countries to recognise an independent Palestinian state with borders on the ceasefire lines which separated Israel and the West Bank before June 1967.
In September 2011, Mahmoud Abbas, the president of the Palestinian Authority and chairman of the PLO, sought full member-state status at the UN based on pre-1967 frontiers. But the bid effectively stalled two months later after Security Council members said they had been unable to "make a unanimous recommendation". Mr Abbas is now expected to submit a downgraded request to the General Assembly for admission to the UN as a non-member observer state. Currently, the PLO only has "permanent observer" status.
The change would allow Palestinians to participate in General Assembly debates. It would also improve the Palestinians' chances of joining UN agencies and the International Criminal Court (ICC), although the process would be neither automatic nor guaranteed. If they are allowed to sign the ICC's founding treaty, the Rome Statute, the Palestinians hope to take legal action in the court to challenge Israel's occupation of the West Bank.
What is the general process?
The attempt to gain full member-state status failed because it had to be approved by the 15-member UN Security Council. In the face of strong lobbying by Israel's close ally, the United States, it could not secure the nine votes it would have required. In any case, as a permanent member of the Council, the US was expected to use its veto power to stop the bid.
The Palestinians insist they have not abandoned their application to become a full UN member state, but it is suspended for the moment.
In theory, the chances of the Palestinians obtaining non-member observer state status are almost certain. A resolution need only be passed by a simple majority at the 193-member UN General Assembly. According to the PLO, more than 130 countries already grant the Palestinians the rank of a sovereign state. However Palestinian officials say they hope to win the votes of 150 to 170 countries at the UN to show the isolation of the US and Israel on this issue.
President Abbas will address the General Assembly on 27 September. Afterwards his aides will consult other countries before submitting a resolution. This could include parameters for future negotiations between Israel and the Palestinians.
A vote on the resolution could be held within 48 hours but is likely to be put off until after the US presidential elections are held in November. Palestinian officials say it will be tabled before the end of the year.
Is this symbolic or will it change facts on the ground?
Getting recognition of Palestinian statehood on the pre-1967 ceasefire lines would have largely symbolic value. Already there is wide international acceptance that they should form the basis of a peace settlement.
The problem for the Palestinians is that Israel's Prime Minister, Benjamin Netanyahu, rejects these territorial lines as a basis for negotiations. He has described them as "unrealistic" and "indefensible". He says that new facts have been created on the ground since 1967: about half a million Jews live in more than 200 settlements and outposts in the West Bank including East Jerusalem. These settlements are considered illegal under international law, though Israel disputes this. Mutually agreed land swaps have been discussed in previous talks as a way to overcome this problem.
The Palestinians argue that admission even as a non-member observer state at the UN would strengthen their hands in peace talks with Israel on core issues that divide them: the status of Jerusalem, the fate of the settlements, the precise location of borders, the right of return of Palestinian refugees, water rights and security arrangements. The Palestinians present the step as necessary to protect their right to self-determination and a two-state solution.
Israel says that any upgrade of the Palestinian status at the UN would pre-empt final-status negotiations. The prime minister's spokesman, Mark Regev, has been quoted in the Jerusalem Post newspaper as saying: "The Palestinians committed themselves to resolving all outstanding issues in negotiations, and such a unilateral action would be viewed as a violation.".
What legal action could the Palestinians consider?
In April, the chief prosecutor of the ICC rejected a declaration by the Palestinian Authority unilaterally recognising the court's jurisdiction. The prosecutor said the ICC could not act because Article 12 of the Rome Statute established that only a "state" could confer jurisdiction on the court and deposit an instrument of accession with the UN secretary general. In instances where it was controversial or unclear whether an applicant constituted a "state", it was the practice of the secretary general to follow or seek the General Assembly's directives on the matter, he added.
While Palestinian chances of joining the ICC would be neither automatic nor guaranteed as a non-member observer state, officials have indicated they will make a new attempt after the forthcoming General Assembly vote.
"Those who don't want to appear before international tribunals must stop their crimes and it is time for them to become accountable," the chief Palestinian negotiator, Saeb Erekat, recently told reporters.
According to the Reuters news agency, Mr Netanyahu has privately expressed concern that Palestinians might accuse the Israeli government of violating the Geneva Conventions' prohibition on forced displacement of populations by establishing settlements on occupied territory. The Palestinians might also seek to have the ICC investigate war crimes allegations from the 2008-2009 Gaza war.
Why is this happening now?
The main reason is the impasse in peace talks. Ahead of the original UN bid, the Palestinians pointed to the September 2011 date that US President Barack Obama had laid out at the General Assembly a year before as the deadline to achieve a two-state solution. The Quartet of Middle East peace negotiators - the US, European Union, Russia and UN - had worked towards the same deadline. A later statement by the Quartet called for an agreement by the end of this year.
Despite the lack of progress on restarting direct negotiations with Israel, Palestinian leaders argue that they have succeeded in building up state institutions and are ready for statehood. The World Bank has said the same, although it has expressed concern about whether the economies of the West Bank and Gaza are strong enough to support a future state.
Last year, the UN membership bid easily won the support of ordinary Palestinians who had been energised by uprisings in other parts of the Arab world. Although there was disappointment at what followed, a decisive vote by the UN Educational, Scientific and Cultural Organisation (Unesco) in favour of admitting the Palestine as a member state in October 2011 helped to compensate. This was broadly seen as a step towards strengthening the Palestinians' position at the UN, although it led to the US suspending funding for Unesco.
How does this fit with previous declarations?
In 1988, the late Palestinian leader, Yasser Arafat, unilaterally declared a Palestinian state within the pre-June 1967 lines. This won recognition from about 100 countries, mainly Arab, Communist and non-aligned states - several of them in Latin America.
UN acceptance of Palestine even as a non-member observer state would have greater impact as the UN is the overarching world body and a source of authority on international law.
Who supports and opposes the latest UN option?
So far this bid has failed to excite public opinion in the occupied territories in the same way as in 2011 and the build-up to it has been more low-key. It is backed by Mr Abbas's Fatah faction, which controls Palestinian-run parts of the West Bank, and was agreed with representatives of other groups in the PLO. However it has been criticised by Hamas, which governs the Gaza Strip. A Hamas spokesman, Sami Abu Zuhri, told the BBC that the efforts were "pointless" and a "repetition of last year's mistake".
Within the wider region, the 22-member Arab League has endorsed the approach.
The main opposition comes from Israel. Looking to dissuade Mr Abbas from his plan, it has threatened to withhold crucial tax revenues it collects on behalf of the Palestinian Authority. This could have damaging consequences after recent protests over high living costs and unpaid wages to government workers.
The US, a major donor nation to the Palestinian Authority, could also impose some financial penalties. After the Palestinians were admitted to Unesco, Washington cut funding to the organisation under legislation dating back to the 1990s, which mandated it if any UN agency granted full membership to Palestine before an permanent peace settlement.
Some European nations which invest heavily in the PA are worried that the new UN strategy could prove risky. Only nine out of 27 EU member states recognised Palestine bilaterally. Those that have not, such as the UK, Germany and France, would be more likely to support a General Assembly resolution that includes a clear roadmap back to the negotiating table.
In the coming weeks, both Palestinian and Israeli delegations will be on a diplomatic drive to win countries around to their point of view.
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