Israeli Prime Minister Ehud Olmert on Monday expressed readiness to make "tangible" changes in the West Bank, telling Palestinian President Mahmoud Abbas that he understands that their months of peace talks must be accompanied by action on the ground, an Israeli official said.

The two leaders met for two hours in Jerusalem, a day after U.S. Secretary of State Condoleezza Rice urged Israel to do more to improve living conditions in the West Bank.

Olmert and Abbas greeted each other warmly at the start of the meeting, held at Olmert's official residence. The men embraced, Abbas signed the guest book, and Olmert bantered with Abbas' aides about European soccer teams before the beginning of the meeting at Olmert's Jerusalem residence.

Despite the appearance of a friendly atmosphere, Abbas aides said Monday the Palestinian leader is considering resigning if sufficient progress isn't made in the coming months.

Rice left the region hours before the meeting, wrapping up her latest diplomatic mission aimed at prodding the sides closer to a deal. During her visit, Rice criticized Israel's military checkpoints and settlements in the West Bank.

Palestinian negotiator Saeb Erekat said Abbas pressed Olmert on the settlement issue during Monday's meeting.

Abbas has sounded increasingly disheartened in recent weeks.

He says continued settlement construction on lands the Palestinians claim, and Israel's refusal to remove roadblocks and ease other travel restrictions are undermining the negotiations and threatening chances of closing a deal by the year-end target date — just before U.S. President George Bush leaves office.

Talks have made no visible progress since their launch at a U.S.-sponsored peace conference last November. However, officials from both sides have acknowledged that they are discussing the key issues in their six-decade conflict: final borders between Israel and a future Palestine, the fate of millions of Palestinian refugees and the status of the disputed holy city of Jerusalem.

During her visit, Rice insisted the year-end target is still realistic, and Israeli government spokesman Mark Regev said the same after Monday's meeting.

"I believe there is a very good chance these talks will produce concrete results for the benefit of both people. We believe the time table set out in Annapolis is achievable," Regev said.

"We also discussed the tangible issues on the ground. We understand fully that political dialogue must be supported by tangible steps on the ground or you can have cynicism on the ground," he added.

On Sunday, Rice made unusually direct remarks about the consequences of Israeli construction and roadblocks, stressing "the importance of creating an atmosphere that is conducive to negotiations."

"That means doing nothing, certainly, that would suggest that there is any prejudicing of the final terms" of a deal setting up an independent Palestinian state in the West Bank, Rice said.

During Rice's visit, she met with the chief Israeli and Palestinian negotiators, and the teams also held separate talks. In a sign of progress, Palestinian negotiators on Sunday for the first time presented maps outlining what they envision as the borders of a future state, an official said.

He said the Palestinians want all of the West Bank — which Israel captured in the 1967 Middle East War — as part of their state, but are ready to give up nearly 2 percent of the territory in exchange for an equal amount of land from what is now Israel.

Israel wants to keep parts of the West Bank in order to retain large Jewish settlements and for what it says are security needs. Maps presented by Israel several weeks ago sought to keep about 10 percent of the West Bank, the Palestinian official said. He said that despite the gaps, the maps indicated the sides are moving closer to a compromise on the issue of final borders. He spoke on condition of anonymity because the talks were closed.

Shortly after Rice's departure, top Abbas aide Nabil Abu Rdeneh sharply criticized the Bush administration. The U.S. needs to step up its involvement and exert pressure on Israel to live up to its peace obligations, such as freezing Jewish settlements, Abu Rdeneh said.

"That's why there should be American pressure on Israel, instead of continuous visits and statements," he said in a reference to Rice's frequent trips to the region.

Abbas aides said the Palestinian president is giving the negotiations two or three months to produce progress and will consider resigning if he believes the talks have failed. They spoke on condition of anonymity because Abbas has not yet made a final decision.

Abbas' moderate government says Israel must make concrete moves to improve the Palestinian economy and show Palestinians why they should support the peace negotiations instead of radical groups like Hamas.

But Israel says measures like roadblocks are vital parts of a security policy that has dramatically reduced militant attacks — and thus enabled peace talks to go ahead.

Olmert's peace efforts are clouded by yet another corruption scandal that threatens to further tarnish him and his government. Israeli police have questioned Olmert in the fifth criminal investigation they have opened into his political activities and financial dealings since he took office in 2006.

Details of the new case are subject to a court-issued gag order, but the investigation has already sparked calls for Olmert to suspend himself or resign. Olmert has never been charged in any of the scandals.