"The activity of the settlements as well as the construction of the security barrier which ends up annexing Palestinian land and isolating many inhabitants, should be suspended," the foreign ministry said in a statement on Friday.
"The Israeli government's intention to build 565 new buildings in the occupied West Bank has met with great concern in Moscow.
"This decision, as well as the construction of security posts in Palestinian territory, is contrary to the spirit and letter of the roadmap," it added.
The Middle East quartet - the United States, European Union, United Nations and Russia - is behind the road map for peace in the Middle East, aimed at creating a Palestinian state alongside Israel by 2005.
Israel's cabinet authorised an extension on Wednesday of the wall it has built to separate Jewish settlements from Palestinians.
Its construction has been controversial, with Palestinians describing it as a land grab, while Israeli officials insist it is a response to frequent human bombings.
US Secretary of State Colin Powell said on Thursday that the wall was a "problem" and voiced concern at the expansion of Israeli settlements.