The 1967 borders include east Jerusalem, the West Bank and the Gaza Strip.
Asuncion: Paraguay has recognised a "free and independent" Palestinian state within its 1967 borders, the Ministry of Foreign Affairs said on Friday.
The South American nation thus joins a wave of other regional countries that include Brazil, Argentina, Bolivia, Chile, Ecuador, Peru, Guyana and Uruguay.
"The Republic of Paraguay expressly reiterates the recognition of this state as free and independent with the borders of June 4, 1967," the Foreign Ministry said in a statement.
The 1967 borders include east Jerusalem, the West Bank and the Gaza Strip, lands occupied by Israel in the Six Day War.
With this measure, Paraguay "reaffirms its conviction that negotiations between Israel and Palestine should re-start with the goal of reaching peace and security for both nations”.
US-backed Israeli-Palestinian peace talks last collapsed in September 2010 when a limited moratorium on Israeli settlement construction in the occupied territories expired.