She will first meet with Egyptian President Hosni Mubarak, a key US ally, who has been a major player in trying to bring Israel and the Palestinians back to the peace table.
Ms Rice held talks in Cairo with "moderate" Arab counterparts after kicking off a regional tour in Saudi Arabia with an appeal for an end to Palestinian infighting.
She flew in from the Saudi city of Jeddah to meet with foreign ministers from Egypt, Jordan and the monarchies that make up the GCC -- Saudi Arabia, Bahrain, United Arab Emirates, Oman, Qatar and Kuwait.
Palestinian President Mahmoud Abbas and Palestinian Prime Minister Ismail Haniya, from Hamas, are engaged in tortuous efforts to form a national unity cabinet with the aim of lifting a Western aid freeze.
At a press conference in Cairo on Tuesday, Ms Rice urged Palestinians to form a government that will respect principles set out by world powers in an effort to relaunch the peace process.
"The Palestinians need a government that can represent the interests of the Palestinian people," Secretary Rice told the press conference.
“They need a government that can engage the international community and can engage the broad consensus that a two-state solution is the answer," she said.
"We talked about how to help (Mr Abbas) in terms of a Palestinian government and a Palestinian authority that is fully committed to the Quartet principles," she said of her visit to Cairo and meetings with Egyptian officials and ministers from the Gulf Cooperation Council (GCC).
The quartet for Middle East peace -- the European Union, Russia, United Nations and US -- drafted the so-called "roadmap" that envisions an independent Palestinian state living side by side in peace with Israel.
But after the radical Hamas movement formed a government last March, the quartet nations withheld all direct financial aid to the Palestinian Authority over Hamas's refusal to recognise the Jewish state, renounce violence and respect former agreements with Israel.
The quartet conditioned the removal of the financial and political boycott on abiding by these conditions.