The recent momentum in the West in favour of recognising Palestine as a state will grow further, the UN Secretary-General said Monday.
Ban Ki-moon's remarks came at a General Assembly meeting in observance of the International Day of Solidarity with the Palestinian People.
"Indeed - as we see around the world - Governments and parliaments are taking action. That momentum will grow," said Ban.
"We, as the international community, must assume responsibility for what is a collective failure to advance a political solution for the Israeli-Palestinian conflict," he said, referring to the US-brokered direct Palestinian-Israeli talks that came to a halt in April.
The British House of Commons last month voted in favour of recognizing Palestine as a state "as a contribution to securing a negotiated two-state solution."
Sweden's left-wing government went further and formally recognised the state of Palestine, prompting Israel to recall its ambassador to Stockholm.
A non-binding resolution was unanimously endorsed on 19 November by Spain's parliament urging Madrid to recognise the state of Palestine.
And the French National Assembly will vote on 28 November on a similar resolution to recognise Palestine.
Ban also expressed fears that "with each passing day the people of the region are losing any sense of connection, any sense of empathy, any sense of mutual understanding" of a common future.
He urged the parties to "step back from the brink and find the path of peace before hope and time run out."
In late 2012, Palestine was granted non-member observer status at the United Nations.
Meanwhile, Palestinian President Mahmoud Abbas welcomed the momentum, saying "positive developments which enhance the opportunities for peace and security and stability in the region."
"Does Israel, the occupying power, understand all of the messages in this regard?," Abbas asked.
Speaking at the UN General Assembly, Israel's ambassador railed against European governments for "failing us again," singling out Sweden's "historic mistake."
European parliaments voting to recognise Palestine are "giving the Palestinians exactly what they want -- statehood without peace," said Ron Prosor.
"By handing them a state on a silver platter, you are rewarding unilateral actions and taking away any incentive for the Palestinians to negotiate or compromise or renounce violence."
The Palestinians are still planning to formally submit to the UN Security Council a draft resolution calling for an Israeli withdrawal from all occupied territory in 2016.
Despite Palestinian statements that the text would come up for a vote in November, Palestinian representative Riyad Mansour told AFP no date had been set for the draft to be discussed at the 15-member council.
The roots of the Israel-Palestine conflict date back to 1917, when the British government, in the now-famous "Balfour Declaration," called for "the establishment in Palestine of a national home for the Jewish people."
Israel occupied East Jerusalem and the West Bank during the 1967 Middle East War. It later annexed the holy city in 1980, claiming it as the capital of the self-proclaimed Jewish state – a move never recognised by the international community.
Palestinians, for their part, continue to demand the establishment of an independent state in the Gaza Strip and West Bank, with East Jerusalem as its capital.