Relations soured after nine Turks died in an Israeli assault on a flotilla trying to break the blockade of Gaza.
Citing two senior Israeli officials, Haaretz reported Friday Yosef Chechnover, a representative of Israeli Prime Minister Binyamin Netanyahu, met in Geneva, Switzerland, with Feridun Sinirlioglu, of the Turkish Ministry of Foreign Affairs.
Turkey has demanded Israel apologize for the deaths of the Turkish activists who were participating in the flotilla in May 2010 and compensate the families of those who were wounded in the assault. Turkey has also demanded that Israel end its blockade of Gaza.
Turkish Prime Minister Recep Tayyip Erdogan has called the demands basic conditions for restoring normal diplomatic relations with Israel.
Israel has refused to apologize to Turkey, and a U.N. report has concluded Israel's naval blockade of Gaza is legal, Haaretz said.
Turkey expelled the Israeli ambassador and recalled its own ambassador from Israel.