Washington DC - The US State Department said Thursday that an Egyptian-led plan for Gaza did not meet the expectations of President Donald Trump, who has proposed mass displacement of Palestinians from the war-battered territory.

The proposed deal "does not fulfill the requirements, the nature, of what President Trump was asking for," State Department spokeswoman Tammy Bruce told reporters.

"It does not meet the expectations," she said.

She spoke shortly after Trump's point man on the Middle East, Steve Witkoff, gave a more positive spin on the Egyptian-led diplomacy, without endorsing the details.

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"We need more discussion about it, but it's a good-faith first step from the Egyptians," Witkoff told reporters at the White House.

Witkoff said Trump had succeeded in "now encouraging other people in the Middle East – Middle Eastern world – to present proactive proposals for what we might consider," he said.

Trump has floated a proposal to take over the Gaza Strip and displace its people, an idea that has drawn wide condemnation around the world.

Arab leaders have sought support for an alternative plan that would finance Gaza's reconstruction through a trust fund.

In a strongly worded social media posting on Wednesday, Trump warned the people of Gaza that "you are DEAD" unless Palestinian militant group Hamas frees hostages, as a ceasefire deal with Israel teeters.

Witkoff suggested that the threat may be a preview to joint action against Hamas.

"I think there's going to be some action. It could be jointly with the Israelis," he said.

"It's unclear right now, but I think Hamas has an opportunity to act reasonably, to do what's right, and then to walk out. They're not going to be a part of a government there," he said.