In what way?
Many Israelis do understand the Palestinians...verbally, at least. There are a lot of Arabic speakers in Israel.
If you mean something more akin to understanding their concerns, then there seem to be a lot of Israelis sympathetic to it. However, Israelis have their own concerns that do not allow them to simply grant the Palestinians certain wishes. For example, a lot of Palestinians wish checkpoints didn't exist so that they could visit family living in Israel, work in higher-paying jobs within Israel, or receive better medical care in Israeli hospitals; however, while Israelis understand that, they also support the checkpoints because they don't want hostile elements of Palestinian society to blow them to smithereens just because they weren't caught earlier on. Israel understands a lot of Palestinians, but that understanding simply doesn't lend itself to an easy resolution of problems.