"On Israel's Independence Day we officially laid the first stone of a new district which will be called Ginot Beit El," Beit El council official David Shawat said.
The new project, which was started some time ago but only officially started Wednesday, is to include some 72 homes and is described as a "new quarter" of Beit El.
But Shawat said plans were also afoot to start a completely new housing project comprising another 40 homes in two or three weeks.
"The construction of another district of Beit El with 40 extra dwellings will be launched from here in two or three weeks," he said.
During the cornerstone ceremony, the head of Beit El's municipal council Israel Rosenberg said the project had been started following remarks by Israeli Prime Minister Ariel Sharon (news - web sites) to the effect that Israel may dismantle some West Bank settlements within the framework of a renewed peace process.
The remarks were made in an interview with Israeli daily Haaretz which was published on April 13, an interview in which Sharon said that Israel would have to relinquish some areas closely associated with Jewish history and mentioned both Beit El and the nearby settlement of Shilo by name.
"We are talking about the cradle of Jewish civilisation. Our whole history is bound up with these places. Bethlehem, Shiloh and Beit El.
"And I know we will have to part with some of these places. There will be a parting from places that are connected to the whole course of our history. As a Jew, this agonizes me," he said.
It was the first time the premier had named specific locations in connection with the possible dismantlement of Jewish settlements in the West Bank, and provoked anger among the pro-settlement Israeli right-wing.
"The Prime Minister's remarks pushed us to build more because what counts is acts on the ground and not declarations," Rosenberg said at the ceremony.
The move comes just two weeks after Israel's right-wing parliamentary speaker Reuven Rivlin laid the first stone in a project to build more houses in Shilo.
"I can't imagine the prime minister wants to transfer Jews" from their homes, Rivlin told AFP.
Sharon has long been a champion of the settlement movement in the West Bank, although the Mideast roadmap for peace, which was published on April 30, calls for a freeze in settlement growth
Jewish settlements, considered illegal by the international community, are the main focus of the 30-month Palestinian uprising, or intifada, which has left more than 3,000 people dead, mostly Palestinians but also hundreds of Israelis.
Around 200,000 people live in the settlements in the West Bank and Gaza Strip (news - web sites).
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