Palestinian officials have praised Australia's formal recognition of the battle-scarred nation, despite pushback from Israel and others including some in Donald Trump's party.

The federal government joined the UK and Canada to officially acknowledge Palestinian statehood in the hope of breathing new life into efforts toward a two-state solution.

"We recognise the legitimate and long-held aspirations of the people of Palestine of a state of their own," Prime Minister Anthony Albanese told reporters in New York.

He said the diplomatic move would reaffirm Australia's support for "two states, the state of Israel and the state of Palestine, living side by side behind internationally recognised borders and peace and security."

More than 140 countries now recognise Palestinian statehood.

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