Netanyahu made the remarks at the start of his Cabinet meeting where he noted recent successful meetings with other Mideast leaders including Egyptian President Hosni Mubarak and Jordanian King Abdullah II.

He said the meetings "created a better international climate for the start of direct talks between Israel and the Palestinian Authority."

However, even as Netanyahu called on the Palestinian Authority "to put aside the claims, excuses and conditions -- and enter into peace talks," he said any settlement reached must be one based on security.

"Security is a fundamental condition and a necessary condition for achieving peace and there will be no compromise in its regard by the State of Israel," he said.

Netanyahu opened his Cabinet remarks by condemning the recent firing of rockets from Gaza into Israel. Two rockets were fired over a 36-hour period beginning on July 30 night, according to Israel Defense Forces. One was fired into Ashkelon on July 30, and another into Sderot on July 31, the IDF said.