Prime Minister Benjamin Netanyahu said Monday Donald Trump's presidency in the United States represented "significant opportunities" for Israel, but called for restraint from fellow right-wing politicians.

Referring to former US president Barack Obama, Netanyahu said "after eight years of withstanding huge pressures on a large array of topics, first and foremost Iran and the settlements, I definitely welcome the change of attitude".

"We're (now) facing great and significant opportunities for the security and future of the state of Israel."

Obama's administration grew frustrated with Israeli settlement building, warning it was eating away at prospects of a two-state solution. 

Netanyahu also strongly opposed the nuclear deal between Israel's arch-foe Iran and world powers, including the United States.

But with right-wing politicians pushing hard for Israel to move immediately to build more settlements and even annex parts of the occupied West Bank, Netanyahu said restraint was needed.

"This is not the time to shoot from the hip," Netanyahu, who heads what is seen as the most right-wing government in Israel's history, told lawmakers from his Likud party.

"This is the time for responsible and rational diplomacy with friends, diplomacy that will strengthen the cooperation between us and the trust between the Israeli government and the new administration in Washington."

Trump has signalled strong support for Israel, and Israeli right-wing politicians have sought to take advantage, with hardliners calling for an end to the idea of a Palestinian state.

Netanyahu has said he still supports a two-state solution, but reportedly told ministers Sunday that all restrictions on building settlements in annexed east Jerusalem were being lifted.

He also said he plans to expand construction in large settlement blocks in the occupied West Bank, Israeli media reported, and that he foresees eventually bringing all settlements under Israeli sovereignty.

Media said those comments helped convince Education Minister Naftali Bennett from the hardline Jewish Home party to postpone a push to immediately annex Maale Adumim, a large West Bank settlement near Jerusalem.

Discussion on whether to do so is to be put off until after Netanyahu meets Trump in early February. The two leaders spoke by phone on Sunday.

Bennett, who opposes a Palestinian state and advocates Israel annexing most of the West Bank, has spoken repeatedly of what he sees as the rare possibilities under a Trump presidency.

"We're calling on PM Netanyahu: Do not miss the opportunity of once in 50 years," he said Monday, according to his office.

But on Monday Netanyahu said: "For the sake of Israel, Israel's security and for the benefit of the settlement movement, I suggest everyone leave aside any other consideration and let me lead the moves."