US National Security Adviser Susan Rice met Israeli leaders Wednesday after the collapse of US-brokered Middle East peace talks and amid allegations Israel was spying on its principal ally.

Rice started her visit by meeting Prime Minister Benjamin Netanyahu.

"They discussed a wide range of regional and bilateral issues, including the United States and Israel's close security cooperation, which has been unprecedented under President Obama's leadership," a White House statement said.

"On Iran, Ambassador Rice... reiterated that the United States will not allow Iran to acquire a nuclear weapon, and that diplomacy is the best way to resolve the international community's concerns peacefully," it added.

She also met Israeli President Shimon Peres and on Thursday is to call on Palestinian president Mahmud Abbas at his headquarters in the West Bank city of Ramallah.

"Looking forward to robust and intensive consultations," Rice wrote earlier in the day on her official Twitter account.

"Our security cooperation with Israel has never been stronger."

Israeli Foreign Minister Avigdor Lieberman on Wednesday "categorically" denied allegations published in Newsweek magazine that his country was engaged in spying on US soil.

Newsweek quoted a former US congressional staffer as saying that Israel "continues to cross the line on espionage" far more than any other US ally.

Lieberman told army radio the allegations were "malicious." "We're talking about lies and falsehood, simply libel which is baseless and unfounded."

It was Rice's first trip to Israel since she took office last July and came just before a new round of negotiations between major powers and Iran over its controversial nuclear programme.

The White House is assessing whether to try to salvage its Middle East peace efforts after the collapse in late April of nine months of US-brokered negotiations.

"Rice has been a leading administration sceptic regarding the prospects of US success in persuading Netanyahu and...Abbas to make the necessary compromises," Israeli daily Haaretz wrote on Sunday.

"Her position was decisive in Obama's decision to declare a time-out in the peace talks," it said.

The White House statement acknowledged the pause but said that the United States "remains convinced that lasting peace can only be secured through direct negotiations that lead to two viable, independent states living side by side in peace and security."