US President Barack Obama has warned that Israeli PM Benjamin Netanyahu must make "tough decisions" to advance peace talks with the Palestinians, BBC reported.
At the White House, Mr Netanyahu replied Israelis expected him to "stand strong" and that the Palestinians had not done their part to ease tensions.
The White House has said it hopes to see a peace deal in place by 29 April.
But there has been little sign of progress since July, when direct talks resumed after a three-year hiatus.
The two leaders spoke publicly on Monday ahead of a bilateral meeting at the White House.
Palestinian Authority President Mahmoud Abbas will visit Mr Obama later this month.
"It is still possible to create two states, a Jewish state of Israel and a state of Palestine, with people living side-by-side in peace and security," Mr Obama said on Monday. "But it's difficult. It requires compromise on all sides."
The US president said the April deadline for the completion of the talks was drawing near, and "some tough decisions are going to have to be made".
"The prime minister will make those decisions based on his absolute commitment to Israel's security and his recognition that ultimately Israel's security will be enhanced by peace with his neighbours."
Sitting beside the US president, Mr Netanyahu pointed to Israel's release of Palestinian prisoners, its withdrawal from Gaza, and other steps it had taken to ease tensions.
"Israel has been doing its part, and I regret to say that the Palestinians haven't," he said.
He demanded the Palestinians recognise Israel as a Jewish state.
And he said, "The best way to guarantee peace is to be strong, and that's what the people of Israel expect me to do: to stand strong against criticism, against pressure."
The meeting between the two leaders came soon after Israel released statistics showing a large increase in the pace of new settlement construction in the West Bank in 2013 over the year before.
About 500,000 Jews live in more than 100 settlements built since Israel's 1967 occupation of the West Bank and East Jerusalem.
Settlements are considered illegal under international law, although Israel disputes this.
The Palestinians suspended the last round of talks in 2010 after a 10-month halt on Israeli building in the West Bank expired.
Out of the current round of talks between Israel and the Palestinians, the US president wants both sides to agree to the framework document - not yet made public - proposed by his Secretary of State, John Kerry, which seeks to achieve consensus on core issues.
They include the borders between Israel and a future Palestinian state; the status of Jerusalem; Israel's insistence that it be recognised as a Jewish state; the Palestinians' demand that their refugees be allowed to return to their former homes in what is now Israel; and security arrangements in the West Bank, with Israel wanting a long-term presence in the Jordan Valley.
The Palestinians have recognised the state of Israel, but say recognising its Jewish character would have implications for Palestinian refugees and Israeli-Arabs.
In an interview with Bloomberg published on Sunday, Mr Obama said he would warn Mr Netanyahu that the "window is closing" for a peace deal.
"When I have a conversation with Bibi [Mr Netanyahu], that's the essence of my conversation: If not now, when? And if not you, Mr Prime Minister, then who? How does this get resolved?" he said, paraphrasing the revered Jewish sage Rabbi Hillel.
If the peace talks failed and there was "continued aggressive settlement construction" in the West Bank, Mr Obama warned, Washington would have limited ability to protect Israel from "international fallout", an apparent reference to the Palestinians' threat to pursue Israel at the International Criminal Court and a boycott campaign.
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