Hopes are high for Clinton after the administration of George Bush, the former US president, was criticised for coming to Arab-Israeli peacemaking only in the final stages of his presidency.
'Difficult and complex'
Barack Obama, the US president, has said the issue will be a priority for his administration and Clinton said she would push on "many fronts" early on.
"This is a very difficult and complex set of issues," she said before her arrival in Jerusalem on Monday.
|Israel's continued settlement building has strained the peace process [AFP]
Peace talks brokered by her husband Bill Clinton, a former president, broke down in 2000, his final year of his presidency.
Talks between Israel and the Palestinians were relaunched at a US-sponsored conference in Annapolis, Maryland, in November 2007, but the talks were halted after Israel's military offensive on Gaza.
Clinton arrived in Israel from an international donors' conference in the Egyptian resort of Sharm el-Sheikh, where countries pledged $5bn to help rebuild Gaza following Israel's war on the territory.
The US pledged $900m at the conference, but Clinton maintained Washington's tough line against Hamas, saying the money would be channelled through the Palestinian Authority rather than being paid to Hamas, which runs Gaza.
At the conference, Arab and European ministers pressed Clinton to push the Israelis to open up border crossings into Gaza and stop Jewish settlement activity.
Israel's blockade of the territory prevents supplies, including construction materials, from crossing into Gaza.
Continued settlement building by Israel has also strained the wider peace process and Netanyahu appears unlikely to put an end to the policy.
Peace Now, the Israeli anti-settlement group, has said the government is planning to build 73,000 new homes in the occupied West Bank.
The Israeli government says only a small number of the housing plans have been officially approved, but Peace Now claims that 15,000 units have been granted approval and that nearly 9,000 have already been built.
Asked whether she would raise the issues such as settlement building and the Gaza blockade, Clinton sidestepped the question.
An unsteady ceasefire has been in place between Israel and Hamas since January, but Israel has carried out a number of air raid on the Hamas-run territory and Palestinian fighters have also fired rockets into southern Israel.
Before arriving in Jerusalem, Clinton said she was troubled by the continuing rocket attacks and reiterated that Israel had a right to defend itself, a message she will likely stress again publicly on Tuesday.
Clinton will visit the West Bank on Wednesday to meet Mahmoud Abbas, the Palestinian president, and Salam Fayyad, the Palestinian prime minister. She also plans to address students at a school there.