In a sign of the difficulties facing her initiative, only Rice will address journalists following the meeting, rather than holding a joint media conference with Olmert and Abbas.

It is the first meeting between Palestinian and Israeli leaders and a senior US official since June 2003.

No recognition

At a meeting in Mecca in Saudi Arabia earlier this month, Abbas and Hamas' Ismail Haniyeh, the Palestinian prime minister, agreed on a formula for a Palestinian unity government.

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The Quartet, consisting of Russia, the European Union, the UN and the US has demanded Palestine recognise Israel, renounce violence and accept previous peace accords in exchange for restoring foreign aid to the Palestinian territories.

Olmert said on Sunday that the new coalition does not meet those demands, so Israel would not deal with such a government and that George Bush, the US president, agreed with that.

US officials said Olmert did not speak for Washington and Rice has said she would draw no conclusions until the formation of the new Palestinian government was known.

After an inconclusive war last summer in Lebanon, Olmert's own position is tenuous.

His approval rating has plummeted below 20 per cent, leaving it politically difficult for him to carry out far-reaching concessions that would be needed for a peace accord with the Palestinians.

Complicated situation

In an interview with Al-Ayyam, a Palestinian daily newspaper, published on Monday, Rice tried to keep a positive outlook.

Rice said: "This is a complicated time, and it has been made more complicated by the (Palestinian) unity government, but I'm not deterred, and I'm not going to wait until the condition is perfect somehow to bring the parties together."

Rice told the newspaper that the US goal was still an independent Palestinian state alongside Israel, following the road map peace plan presented by Bush in 2003.

But she admitted that agreement is not at hand, and her expectations of the Monday summit were low.

She said: "I don't even assume that we are going to come to a common view of what needs to be discussed in this initial meeting."

"We could have decided not to meet during this time, but I actually think when people have questions and want to explore issues that arise like the agreement to form a national unity government that it's better that they be able to do it face-to-face."

She also indicated there would be a virtual news blackout around the talks.

Rice said: "Not only am I not going to talk about what we're going to talk  about before going in, I'm probably not going to talk about it coming out."