Israel and the Palestinians have not held direct talks for more than three years and Trump acknowledged it was one of the toughest deals of all.
He has however stressed the strong bonds between the US and Israel. But in both the West Bank and Gaza, Palestinians held angry protests against the US president's visit.
Speaking about the prospect of a peace deal with the Palestinians, he expressed hope that his meeting with President Abbas, in Bethlehem, could be useful and fruitful.
Later today, Trump will return to Jerusalem to visit the Vad Yashem Holocaust memorial and make a speech at the Israel Museum.
The two-day visit to Israel and the Palestinian territories forms part of Trump's first foreign trip as US president.
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