"We are bringing Israeli and Palestinian leaders to London later in December to establish how best we can use 2009 to make real progress towards political and economic solutions in the region," Brown told parliament.
A spokesman for Brown said he had invited Israeli Prime Minister Ehud Olmert and Palestinian Prime Minister Salam Fayyad to visit London on Dec. 15.
Brown would hold separate talks with the two leaders but they would not meet each other, he said.
"They will discuss the economic regeneration of Palestine and the prospects for peace in 2009," a Foreign Office spokeswoman said.
Brown's spokesman said Fayyad was coming to London for a Palestinian investment conference, a follow-up to a meeting in Bethlehem in May when private investors pledged to pump $1.4 billion into Palestinian businesses to bolster the economy.
Olmert resigned in September but continues serving in a caretaker capacity until a new government is formed after a Feb. 10 election.
U.S. President-elect Barack Obama, who takes office on Jan. 20, inherits a gloomy outlook for progress towards settling the Israeli-Palestinian conflict.
Israel and the Palestinians launched U.S.-sponsored peace talks in Annapolis, Maryland, last year with the hope of reaching a deal by the end of 2008.
The talks have been hobbled by violence and bitter disputes over Jewish settlement building and the future of Jerusalem, and all sides have said the year-end deadline will not be met.
Israel's Foreign Minister Tzipi Livni urged European Union parliamentarians on Tuesday to support U.S.-backed peace talks with the Palestinians rather than promote separate initiatives.
"Even if it takes more time, we do not need intervention by the international community with bridging proposals," Livni, who hopes to succeed Olmert in the February election, said in Brussels.
Israelis generally see the Europeans as overly sympathetic to the Palestinians, and look to the United States as the main powerbroker.
