The government, sworn in on Tuesday at a ceremony in the West Bank city of Ramallah, is staffed mostly by Abbas's Fatah faction and excludes Hamas.
It is headed by Salam Fayyad, the US-educated prime minister who once worked for the World Bank and International Monetary Fund (IMF).
Fayyad said on Wednesday: "The main objective should be ending internal division.
"There is an urgent need to empower the Palestinian Authority to continue providing the services to citizens in the West Bank and also in Gaza.
"This is what the previous government did under extremely difficult and complicated conditions, and in the light of its capacities."
Fatah and Hamas delegates adjourned a fifth round of reconciliation talks in Egypt without a deal on Monday.
Lamis Andoni, Al Jazeera's senior political analyst, explained that the new cabinet was formed in spite of objections from several Fatah leaders and opposition by Hamas to Fayyad being reappointed.
Fatah leaders had expressed concerns that the formation of the new government would hurt reconciliation talks with Hamas, she said.
Most of the new ministers are known supporters of reconciliation with Hamas, Andoni said.
Some, like Lamis Alami and Ali Al Jarbawi, are former members of the independent Palestinian commission on human rights, which documented violations by the Palestinian Authority (PA) and Hamas, she added.
The rift between Fatah and Hamas has undermined prospects of resuming stalled talks with Israel.
In an interview with Al Jazeera, Hillary Clinton, the US secretary of state, said that Washington is open for negotiations with Hamas, but only if the group meets certain conditions and commits to peace.
"You cannot expect either Fatah or the Israelis or Arabs who wish to see this matter resolved with a two-state solution to work with a group that does not believe in the outcome of these efforts," she said.
"We would expect Hamas to recognise Israel's right to exist, to renounce violence as the way to the achievement of a homeland for the Palestinian people, and to recognise the prior agreements that have been entered into by the Palestinians either through the PLO [Palestine Liberation Organisation] or the PA.
"I think that's an incredibly reasonable request, now it is truly up to Hamas," she said.
Agreement between Fatah and Hamas is also vital for the reconstruction of the Gaza Strip, left in ruins by Israel's 22-day offensive last December and January that killed more than 1,400 Palestinians and 13 Israelis.
International donors pledged $4.5bn to the PA in March, with the bulk of the funds intended for the reconstruction of Gaza.
But many donor countries refuse to channel their funds through Hamas, which has de facto control of the Gaza Strip, insisting that Abbas's government must supervise the spending.
Hamas won Palestinian parliamentary elections in January 2006 and formed a government that March.
However, the cabinet was boycotted by Israel and the West over the group's refusal to renounce violence as well as recognise Israel and past peace deals.
Tensions between Hamas and Fatah grew for months afterwards, often erupting into violent clashes, but the two sides managed to form a unity government in March 2007 after Saudi mediation.
The unity government was short lived, however, and the government unravelled when Hamas forces seized control of the Gaza Strip from Abbas loyalists in June 2007.
Hamas has since been governing the Gaza Strip while Abbas, backed by the US and EU, has been in charge of the West Bank.