President Mahmoud Abbas said he will send a delegation to Cairo, in two days, to follow up with the Palestinian reconciliation issue.
Mohammed Shtayyeh, an economist and longtime Abbas adviser, will serve as prime minister of the West Bank-based Palestinian Authority (PA).
In anticipation for the long awaited release of President Donald Trump's Mideast "deal of the century", European politicians who had held high-ranking positions in their governments and in European institutions, published a letter calling for the rejection of the proposed plan.
Analysts say the change of government was made to further isolate Hamas, which has been at odds with the Fatah party of Abbas and Shtayyeh for more than a decade.
Abbas, 84, is seen as retaining the real decision-making authority.
The Islamic Hamas movement, ruler of the Gaza Strip, slammed on Saturday the formation of a new Palestinian government for deepening the internal division.
He also criticized the new Palestinian government as "a separatist government that doesn't include all factions and political powers".
In a letter sent to the Guardian newspaper, former high-ranking European politicians call on Europe to reject the expected plan unless it is fair to the Palestinians.
Since coming to power, Trump has proven to be perhaps the most pro-Israel American president in history, breaking with decades of global consensus to recognise Jerusalem as the country's capital and Israel's control over the Golan Heights.