"We are seeking clarifications from the Israeli government on what its intentions are," deputy department spokesman Adam Ereli said.
The Israeli newspaper Yedioth Ahronoth reported Monday the expansion in Maaleh Adumim, the largest Jewish settlement. Settlement expansion is prohibited under the U.S.-backed "road map" to peace in the region.
U.S. Ambassador Dan Kurtzer reportedly met with Israeli officials. Ereli said David Welch, assistant secretary of state for near eastern affairs, and Elliott Abrams, deputy national security adviser, are in the region on a previously scheduled visit and are also to take up the issue.
"There needs to be an end to settlement activity," Ereli said.