Officials say the Obama administration in its waning hours defied Republican opposition and quietly released $221 million to the Palestinian Authority.
GOP members of Congress had been holding up the money.
A State Department official and several congressional aides say the outgoing administration formally notified Congress it would spend the money Friday morning, just before Donald Trump became president.
More than $227 million in foreign affairs funding was released at the time, including $4 million for climate change programs and $1.25 million for U.N. organizations.
At least two GOP lawmakers had placed holds on the Palestinian funds. Congressional holds are generally respected by the executive branch but not the defiant Muslim Obama.