The Palestine Liberation Organization's office has served as a de facto embassy for the Palestinian people. It's unclear when the notice will take effect.
But in a statement, Nauert accused Palestinian leadership of condemning and not cooperating with the Trump administration's forthcoming peace plan, orchestrated by President Trump's senior adviser and son-in-law Jared Kushner.
"The Trump administration will not keep the office open when the Palestinians refuse to take steps to start direct and meaningful negotiations with Israel," National Security Advisor John Bolton said during a speech Monday. Bolton added that there "no evidence that the PLO office in Washington contributed to diplomacy" and argued the decision "will have ultimately a positive impact on the potential for discussion among the parties as it eliminates unrealistic expectations that at least some of the parties have."
But the Palestinians were quick to blast the decision, condemning the Trump administration's "policy to collectively punish the Palestinian people," Dr. Saeb Erekat, a senior Palestinian official, said in a statement.
"We will not succumb to U.S. threats and bullying and... we will continue our legitimate struggle for freedom, justice, and independence, including by all political and legal means possible," he added.
That includes a push to have the International Criminal Court investigate Israel for possible war crimes against the Palestinian people. Erekat said the Palestinians will continue to push for that, which Nauert also cited as a reason for the U.S. decision to shut down the office.
Bolton's speech Monday was a warning to the ICC for another possible investigation – into possible U.S. war crimes in Afghanistan.
"I'd say, 'You'll get money, but we're not paying you until we make a deal. If we don't make a deal, we're not paying.' And that's going to have a little impact," Trump said on a conference call with Jewish leaders Thursday.
Critics have warned that the cuts will lead to a humanitarian crisis in Gaza and an escalation in unrest, tensions, and violence – and certainly not to the Palestinians coming to the table. Their leadership has already roundly rejected those moves, saying the U.S. has lost its role as a peacemaker because of it.
But Nauert said in her statement Monday that the administration is "not retreating from our efforts to achieve a lasting and comprehensive peace."
It's unclear when Kushner's team will unveil its peace plan, but it is expected sometime this fall.