A top Hamas official said that the newly announced Palestinian unity government “will not recognize ‘Israel’ and will not give up the resistance,” throwing into jeopardy the new ruling government’s access to U.S. assistance and other measures.

Palestinian President Mahmoud Abbas has threatened to dissolve the long ruling Palestinian Authority and and has now surprised observers by forming a government with the terror group Hamas, which rules over the Gaza Strip.

Hamas and Fatah—Abbas’s political party that controls the West Bank—surprised Middle East observers on Wednesday morning by announcing that the rival groups would put aside differences to form a unity government with elections scheduled for later this year.

The move tossed another wrench into the fledgling peace talks between Israel and the Palestinians and prompted sharp responses from U.S. officials.

Events took another surprising turn this afternoon when top Hamas official Hassan Yousef announced that the terror group would not renounce its commitment to violence and the destruction of Israel, according to Palestinian groups monitoring the situation.

Hamas will not recognize Israel—a chief sticking point in peace talks with Abbas—and “will not give up the resistance,” which is widely interpreted to refer to Hamas’s ongoing terror attacks against Israeli civilians and military personnel.

The announcement of the unity government came just days after Abbas threatened to completely dissolve the PA should peace talks come to a complete halt.

Israeli Prime Minister Benjamin Netanyahu reacted to the news with skepticism.

“The Palestinian Authority, which just yesterday spoke about its dissolution, is now talking about reconciling with Hamas,” Netanyahu was quoted as saying. “They should decide what they want—dissolution to reconciliation? They should let us know when they want peace, because we want a true peace.”

Netanyahu said on Wednesday following news of the unity government that Abbas is siding with terror over peace.

“Does he [Abbas] want peace with Hamas or peace with Israel?” he asked. “You can have one but not the other. I hope he chooses peace, so far he hasn’t done so.”

State Department spokeswoman Jennifer Psaki warned that the move could demolish the peace talks as well as America’s relationship with the PA.

“A great deal of effort has gone into building Palestinian institutions by Palestinians as well as the international community, and it would certainly not be in the interests of the Palestinian people for all of that to be lost,” Psaki told reporters.

Such a move would jeopardize U.S. assistance to the Palestinians, which has topped $100 million in recent years.

“The United States has put millions of dollars into this effort. It would obviously have very serious implications for our relationship, including our assistance going forward,” Psaki said.

Rep. Ileana Ros-Lehtinin (R., Fla.) announced on Wednesday that she will be lobbying other members of Congress to cut off aid to the Palestinians.

“The administration must halt aid to the Palestinian Authority and condition any future assistance as leverage to force Abu Mazen to abandon this reconciliation with Hamas and to implement real reforms within the PA,” she said in a statement.

“U.S. law is clear on the prohibition of U.S. assistance to a unity Palestinian government that includes Hamas, a designated Foreign Terrorist Organization, and President Obama must not allow one cent of American taxpayer money to help fund this terrorist group,” Ros-Lehtinen said.

“In the coming weeks, I will convene a subcommittee hearing on this issue and many more regarding the PA, Israel and the peace process,” she said. “It’s long past time the U.S. reassess its relationship with the corrupt Abu Mazen and his cronies.”

While Abbas has threatened to disband the PA in the past, the collapse of the latest round of U.S.-led peace talks has lent some urgency to his threat.

Israel could be forced to reassume governing control of the Palestinian territories, such as it did in the days before the Oslo accords.

A unilaterally established independent State of Palestine could complicate things further. Such a state would not be beholden to any security agreements with Israel or the United States and would not be forced to engage in any transparency measures.