International donors like the European Union and the United States froze aid to the newly elected Hamas-led Palestinian government in March.
The Western powers demanded that the Islamist movement renounce violence, recognize Israel and agree to abide by past peace agreements.
The EU, the US and Israel consider Hamas a terrorist organisation.
On Monday moderate President Mahmoud Abbas and Prime Minister Ismail Haniya from Hamas agreed to form a coalition government to avert a deepening social and economic crisis.
In 2005, international aid to the Palestinian Authority totaled to US$800 million (AU$1.07 billion).
The deal will dissolve the current government and will require Mr Haniya to form a new cabinet.
But US Deputy State Department spokesman Tom Casey said that Washington hasn't yet seen the details of the agreement on the formation of the government of national unity.
He said US officials were equally interested in seeing the political platform which the unity government will be charged with implementing.
"However, what I can say is, from what we've seen so far, we are certainly concerned that the national unity government does not appear to meet the quartet's call for a Palestinian Authority government that meets specific criteria that we've outlined before," Mr Casey said.
"And it's important, obviously, that those criteria be met so that there can be a Palestinian partner for peace," he said.
Blair call for sanctions lift
British Prime Minister Tony Blair appeared to respond more positively to the agreement.
"On the basis it is faithful to the conditions spelled out by the Quartet, that is the UN, EU, US and Russia, we should lift the economic sanctions on the Palestinian authority," Mr Blair said.
Under the deal announced by Mr Abbas and Mr Haniya, the platform of the unity government will be based on an initiative agreed by Palestinian factions on June 27, which implicitly recognizes Israel's right to exist.
"This is not going to be a Hamas government, it is going to be a coalition government. Hamas will be part of it," Ahmed Yussef, a senior advisor to Haniya, told AFP.
UN warning
The United Nations warns that a Western aid boycott has left the Palestinian economy on the verge of collapse with two out of three families living below the poverty level.
The UN has said the Palestinian economy will implode over the next 18 months if current constraints aren't removed.
The international body said that the loss of agricultural production from Israel's separation barrier and confiscation of almost one-fifth West Bank farm land has contributed to the decline.