Hopes for peace in Israel are "slipping away", according to John Kerry.
The US Secretary of State said the idea of a one-state solution in the region was not viable, and affirmed the US's commitment to a two-state answer.
"We cannot, in good conscience, do nothing, and say nothing, when we see the hope of peace slipping away," Kerry said.
He added: "The truth is that trends on the ground - violence, terrorism, incitement, settlement expansion and the seemingly endless occupation - are destroying hopes for peace on both sides and increasingly cementing an irreversible one-state reality that most people do not actually want."
No US government has done more to protect Israel's security and ensure its future than Barack Obama's, according to John Kerry.
The US Secretary of State said its vote not to veto a UN resolution calling for an end to Israeli settlement building was in line with securing the Middle Eastern nation's future.
"We cannot properly defend and protect Israel if we allow a viable two-state solution to be destroyed before our own eyes," Kerry said.
He added that the US vote was about "preserving the two-state solution", maintaining that the country had shown "unwavering" commitment to Israel.
"Israel's future is a Jewish and democratic state, living side-by-side in peace and security with its neighbours," Kerry said.
He added: "No American administration has done more for Israel's security than Barack Obama's."
The US did not veto a UN resolution demanding an end to Israeli settlement building because it was in accordance with American "values".
Secretary of State John Kerry said the US had done "more than any other country" to support Israel, but that it could not "stand idly" by as the region becomes more unstable.
"If we were to stand idly by, and know that in doing so we were allowing a dangerous dynamic to take hold - which promises greater conflict and instability - to a region in which we have vital interests, we would be derelict in our own responsibilities," Kerry said.
He added: "Friends need to tell each other the hard truths."
"The US did in fact vote in accordance with our values - just as previous administrations have done at the Security Council before us," he said.
A peaceful future between Israelis and Palestinians is now in "jeopardy," according to US Secretary of State John Kerry.
Explaining why America did not veto a UN resolution demanding an end to Israeli settlement building, Kerry said the US could not have done it "in good conscience".
Kerry said the resolution made clear both Israel and the Palestinians needed to act now to "preserve the possibility of peace".
He added there is "still a way forward if responsible parties are willing to act".
US Secretary of State John Kerry has said a two-state solution is the "only way" to achieve lasting peace between Israel and Palestinians.
Delivering a farewell speech in Washington, Kerry maintained that President Obama had been "deeply committed" to Israel and its security.
Kerry added that commitment had "guided" Obama's pursuit of peace in the Middle East.
"The two-state solution is the only way to achieve a just and lasting peace between Israelis and Palestinians," Kerry said.
"It is the only way to ensure Israel's future as a Jewish and democratic state - living in peace and security with its neighbours."
Israeli Prime Minister Benjamin Netanyahu has thanked incoming President Donald Trump for his "clear-cut support" for the Middle Eastern nation.
Netanyahu tweeted that Trump had shown his nation "warm friendship" -hours after the President-elect used social media to chide Barack Obama for his stance towards Israel.
Secretary of State John Kerry is set to give a speech on Wednesday addressing international opposition to Israeli settlement building.
Trump tweeted earlier on Wednesday that the world should not continue to treat Israel with "such total disdain".
In response, Netanyahu tweeted:
US President-elect Donald Trump today chided the Obama administration for its stance toward Israel.
John Kerry, the US Secretary of State, will give a speech later today addressing international opposition to Israeli settlement building.
Sorry, this content isn't available on your device.
Sorry, this content isn't available on your device.
Israeli Prime Minister Benjamin Netanyahu has summoned the US and British ambassadors to Israel and eight other envoys to be reprimanded amid a row with the UN.
US ambassador Daniel Shapiro was particularly called to discuss the US decision to abstain in a UN Security Council resolution demanding an end to Israeli settlement-building.
The White House has denied an allegation from Netanyahu that President Obama had conspired with the Palestinians to push for the resolution's adoption.
The envoys from 10 of the 14 countries that voted for the resolution and have embassies in Israel were summoned to the foreign ministry, namely China, Russia, France, Egypt, Japan, Uruguay, Spain, Ukraine and New Zealand.
The Israeli prime minister said the country would stop funding for a number of UN bodies deemed as 'hostile' to Israel.Read the full story ›
Israel Prime Minister Benjamin Netanyahu has said he looks forward to working with President-elect Donald Trump after being "failed" by the Obama administration.
In a statement, he said: "The Obama administration not only failed to protect Israel against this gang-up at the UN, it colluded with it behind the scenes.
"Israel looks forward to working with President-elect Trump and with all our friends in Congress, Republicans and Democrats alike, to negate the harmful effects of this absurd resolution."