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Yes. They are a major sticking point between the Israelis and the Palestinians. To read about why they are such a problem, please read below.

Close to 500,000 Israelis live in the West Bank or East Jerusalem in several major cities like Ariel, Modiin Illit, East Jerusalem, Pisgat Zeev, Ma'ale Adumim, and Efrat. Entire neighborhoods, schools, universities, companies, and livelihoods have been built up in the West Bank, not to mention voters in Israeli elections. The removal of settlements is a difficult political and social issue within Israel as it would be very costly both monetarily and socially to uproot 500,000 people and resettle them.

The Settlers believe that they have the right to live closer to the various holy sites in the West Bank and East Jerusalem. For many of them, this is part of why God allowed Israel to conquer the West Bank in the first place. They want to raise their children and build a life near where Jewish civilization actually began, in the hills of Judea and Samaria which form the West Bank.

In order to build to these settlements, land in the West Bank is confiscated according to a variety of arcane, inane, and relatively unjust laws (depending on your perspective). In addition to the lands taken in order for the Settlers to live, Settlers have also taken sufficient lands to build highways and other infrastructure to connect the Settlements to 1949 Israel, bypassing Palestinian cities and making it more difficult for Palestinians to move between different Palestinian cities in the territories. Several Israeli Settler Highways even prohibit Palestinian usage.

Finally, the Settlers live under Israeli Civil Law even though their Palestinian Neighbors live under Israeli Martial Law. This creates a weird dynamic where Settlers who commit crimes are judged in 1949 Israel in front a judge and Israeli jury. Palestinians who commit crimes are judged in the West Bank at a military tribunal presided over by an Israeli Army Judge. It creates incentives for Israeli Settler recklessness since Palestinians are likelier to face worse treatment for counterattacks than the Settlers for the original attacks. This is not to say that Palestinians are innocent in the bloody Settler-Palestinian clashes, but that the legal structure makes it easier for Israeli Settlers to provoke Palestinians without worrying about the consequences.

Given all of the above, the Palestinians abjectly refuse to allow the Settlements to remain in an independent Palestine. Israel, however, cannot justify uprooting so many settled Israelis. Several two-state solution plans accord as many "border" settlements as possible to the Israeli government while giving Palestinians extra territory in the areas around the Gaza Strip and southern West Bank as land swaps. However, some cities, like Ariel are too deep in the West Bank to seriously exchanged.

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