U.N. Secretary General Ban Ki-moon denounced the move and Palestinian officials said they would push for a resolution at the United Nations against Israel's settlement policies.
"Settlement activities are a violation of international law and run counter to the public pronouncements of the government of Israel supporting a two-state solution to the conflict," Ban said in a statement.
The land, in an area under Israeli military occupation and already used by Jewish settlers to farm dates, is situated near the northern tip of the Dead Sea.
Palestinian officials denounced the seizure.
"Israel is stealing land specially in the Jordan Valley under the pretext it wants to annex it," Hanan Ashrawi, a senior member of the Palestine Liberation Organization, told Reuters. "This should be a reason for a real and effective intervention by the international community to end such a flagrant and grave aggression which kills all chances of peace."
The United States, whose ambassador angered Israel this week with criticism of its West Bank policy, said it was strongly opposed to any moves that accelerate settlement expansion.
"We believe they're fundamentally incompatible with a two-state solution and call into question, frankly, the Israeli government's commitment to a two-state solution," Deputy State Department spokesman Mark Toner said on Wednesday.
In a development likely to further upset Europe, Israeli forces demolished six structures in the West Bank funded by the EU's humanitarian arm. The structures were dwellings and latrines for Bedouins living in an area known as E1 — a particularly sensitive zone between Jerusalem and the Dead Sea.
Israel has not built settlements in E1, with construction considered a "red line" by the United States and the EU. It could potentially split the West Bank, cutting Palestinians off from occupied East Jerusalem, which they seek for their capital.
"This is the third time they demolished my house and every time I rebuilt it, this time also I will rebuild it and I am not leaving here. If we leave they will turn the place into a closed military zone," said Palestinian Saleem Jahaleen, whose home was razed.