The United States says the militant Islamist movement Hamas must lay down its weapons if it is to play a part in a new Palestinian government.
Hamas, which dominates the Gaza Strip, and the rival Fatah faction recently agreed to end years of bitter division.
US special envoy Jason Greenblatt said any Palestinian unity administration would need to recognise the State of Israel and disarm "terrorists".
A Hamas official described the US demand as "blatant interference".
Israel - which like the US considers Hamas a terrorist organisation - has said it will not deal with a Palestinian government that "relies on Hamas".
Palestinians in Gaza and the West Bank have been ruled separately since deadly clashes between Hamas and Fatah broke out in 2007.
Hamas won parliamentary elections in the occupied territories the previous year, and reinforced its power in Gaza after ousting Fatah from the enclave.
Last Thursday, the factions agreed that administrative control of Gaza, including the Rafah border crossing, would be handed to the Fatah-led Palestinian Authority (PA) by 1 December.
PA officials said there were no plans to appoint Hamas members to the government.
About 3,000 Fatah security personnel will also join Gaza's police force, but there is no agreement on yet on the role of Hamas' 25,000-strong armed wing.
In a statement issued on Thursday, Mr Greenblatt said it was essential that the PA was able to "assume full, genuine, and unhindered civil and security responsibilities in Gaza" and that the humanitarian situation there was improved.
He also stressed that "any Palestinian government must unambiguously and explicitly commit to non-violence, recognise the State of Israel, accept previous agreements and obligations between the parties - including to disarm terrorists - and commit to peaceful negotiations".
"If Hamas is to play any role in a Palestinian government, it must accept these basic requirements," the envoy added.
A senior Hamas official immediately rejected the US demands.
"This is blatant interference in Palestinian affairs because it is the right of our people to choose its government according to their supreme strategic interests," Bassem Naim told AFP news agency.
Mr Naim said the US had come under pressure from Israeli Prime Minister, Benjamin Netanyahu, who on Tuesday insisted he would "not conduct diplomatic negotiations with a Palestinian government that relies on Hamas" unless the following conditions were met:
- Hamas recognises Israel, "desists from terrorism" and disarms
- The bodies of Israeli soldiers and civilians held by Hamas are returned
- The PA exercises full security control in Gaza
- The PA continues to act against Hamas "terror infrastructure" in the West Bank
- Hamas severs its ties with Iran
- Funds and humanitarian equipment continues to flow into Gaza only via the PA
There was no immediate reaction from the PA to Mr Greenblatt's statement, but a spokesman for President Mahmoud Abbas said Israel's conditions would "not change the official Palestinian position to move forward with reconciliation efforts".