"This construction violates previous agreements and undermines efforts to achieve piece," Mr. Obama said last week in Cairo.
The settlers are furious, reports CBS News correspondent Mark Phillips.
"We are the landlords. And we're living not with anyone's permission. We own the place," said Elisha Saracik, a West Bank settler.
While the settlers have always known that new outposts have been forbidden under various peace plans, and some have been forcefully demolished, successive Israeli governments, they insist, have always had a nod-and-wink understanding with the United States that building on existing settlements was tolerated. Washington denies any such deal.
"Do you feel betrayed by Washington?" Phillips asked.
"Yeah, there's a feeling of betrayal," said Aliza Herbst with the Settlers Movement Council. "We've had six decades of American presidents whose orientation was in our direction, and now I think that we are having to wake up."
Mr. Obama may not only have changed the rules of the game in these settlements, he may actually have changed the very nature of the relationship between the U.S. and Israel. Previous American presidents have called for a settlement freeze. The fear here is that this one may actually mean it.
Prime Minister Benjamin Netanyahu now faces a stark choice - satisfy his right-wing, pro-settlement government coalition, or satisfy the White House.
"The most important Israeli diplomatic statement is not what's said in the negotiating room, it's what is built on the hillsides. The bulldozers and the cranes state Israel's diplomatic position," said Gershon Gorenberg, the author of "The Accidental Empire."
And those bulldozers and cranes are still at work.