Prince Faisal bin Farhan bin Abdullah made the announcement at a meeting of foreign ministers in New York, saying the alliance will work to bring about a comprehensive and fair peace.
"We invite all countries to join this alliance and emphasize that we will exert all efforts to achieve a just and lasting peace," bin Farhan said.
He said the Gaza war has led to a major humanitarian crisis, separate from the Israeli occupation's crimes in the West Bank, which have added to violence and desecrated the Al-Aqsa Mosque.
Bin Farhan also warned "We are witnessing these days a dangerous regional escalation that affects the Lebanese Republic and leads us to the risk of a regional war that threatens our region and the entire world."
The Israeli military has launched widespread attacks on southern Lebanon since Monday, and the assault continues.
Hezbollah in Lebanon has responded to the attacks on civilians by launching its own operations against Israeli positions and settlements in northern Palestine since early Monday morning.
The Lebanese Health Ministry says 558 people have been killed and 1,700 wounded in the Israeli airstrikes on Lebanon.
SPA