The controversial 28-point proposal - which would hand swathes of land to Russia and limit the size of Kyiv's military - closely resembles the Kremlin's demands.
Mr Zelenskyy has warned he has reservations about the plan, telling Ukrainians in a solemn speech: "Now is one of the most difficult days in our history."
But Russian President Vladimir Putin has cautiously welcomed the US proposals - and said they "could form the basis for a final peace settlement".
Speaking to reporters at the White House, Mr Trump appeared to dismiss Mr Zelenskyy's concerns: "He'll have to like it... at some point, he's going to have to accept something."
The US president went on to reference their now-infamous Oval Office meeting back in February, where he told Ukraine's leader "you don't have the cards".
Kyiv has been given until Thursday to accept the peace plan - but this deadline could be extended to finalise the terms.
'I am highly sceptical it will achieve peace'
Mr Trump has received pushback from members of his own party, with a prominent Republican warning the plan "has real problems".
Senator Roger Wicker, who chairs the Senate Committee on Armed Services, expressed doubt that the White House proposals would achieve peace.
"Ukraine should not be forced to give up its lands to one of the world's most flagrant war criminals in Vladimir Putin," he warned.
Tim Ash from the Chatham House think tank added: "Russia gets everything it wants and Ukraine gets not very much.
"If Zelenskyy accepts this, I anticipate huge political, social and economic instability in Ukraine."
According to Reuters, European nations including the UK, France and Germany are now working on a counterproposal with Kyiv.
EU leaders, who were not consulted about the plan, will hold a meeting on the sidelines of the G20 summit in South Africa today.
Sir Keir Starmer, who spoke to Mr Zelenskyy by phone yesterday, has warned "Russia pretends to be serious about peace, but their actions never live up to their words".
Ahead of the talks, the prime minister said: "Ukraine has been ready to negotiate for months, while Russia has stalled and continued its murderous rampage. That is why we must all work together, with both the US and Ukraine, to secure a just and lasting peace once and for all. We will continue to coordinate closely with Washington and Kyiv to achieve that.
"However, we cannot simply wait for peace, we must strain every sinew to secure it. We must cut off Putin's finance flows by ending our reliance on Russian gas. It won't be easy, but it's the right thing to do."
The EU's foreign policy chief, Kaja Kallas, said: "We all want this war to end, but how it ends matters. Russia has no legal right whatsoever to any concessions from the country it invaded. This is a very dangerous moment for us all."
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'Ukraine may be facing an extremely difficult decision'
During his address, Mr Zelenskyy said he would not betray Ukraine's national interest - but warned dilemmas lie ahead.
He added: "Either a loss of dignity or the risk of losing a key partner. Either accepting a complicated list of 28 demands or enduring an extremely harsh winter, the harshest yet, with all the risks that follow.
"A life without freedom, without dignity, without justice. And all while being asked to trust someone who has already attacked us twice."
Washington has reportedly threatened to cut off intelligence sharing and weapons supplies if Kyiv refuses to accept the deal.
The US-backed proposal would require Ukraine to withdraw from territory it still controls in eastern provinces that Russia claims to have annexed - with Russia giving up smaller amounts of land it holds in other regions.
Ukraine would also be permanently barred from joining NATO, and its armed forces would be capped at 600,000 troops.
Sanctions against Russia would also be gradually lifted, with Moscow invited back into the G8 and frozen assets pooled into an investment fund.
If accepted, it would reward armed aggression. The principle, sacrosanct since the Second World War, for obvious and very good reasons, that even de facto borders cannot be changed by force, will have been trampled on at the behest of the leader of the free world.
The Kremlin will have imposed terms via negotiators on a country it has violated, and whose people its troops have butchered, massacred and raped. It is without doubt the biggest crisis in Trans-Atlantic relations since the war began, if not since the inception of NATO.
The question now is: are Europe's leaders up to meeting the daunting challenges that will follow. On past form, we cannot be sure.
The plan proposes the following:
• Land seized by Vladimir Putin's unwarranted and unprovoked invasion would be ceded by Kyiv.
• Territory his forces have fought but failed to take with colossal loss of life will be thrown into the bargain for good measure.
• Ukraine will be barred from NATO, from having long-range weapons, from hosting foreign troops, from allowing foreign diplomatic planes to land, and its military neutered, reduced in size by more than half.
And most worryingly for Western leaders, the plan proposes NATO and Russia negotiate with America acting as mediator.
Lest we forget, America is meant to be the strongest partner in NATO, not an outside arbitrator. In one clause, Mr Trump's lack of commitment to the Western alliance is laid bare in chilling clarity.
And even for all that, the plan will not bring peace. Mr Putin has made it abundantly clear he wants all of Ukraine.
He has a proven track record of retiring, rallying his forces, then returning for more. Reward a bully as they say, and he will only come back for more. Why wouldn't he, if he is handed the fortress cities of Donetsk and a clear run over open tank country to Kyiv in a few years?
Since the beginning of Trump's presidency, Europe has tried to keep the maverick president onside when his true sympathies have repeatedly reverted to Moscow.
It has been a demeaning and sycophantic spectacle, NATO's secretary general stooping even to calling the US president 'Daddy'. And it hasn't worked. It may have made matters worse.
The parade of world leaders trooping through Sharm el-Sheikh, Egypt, lavishing praise on his Gaza ceasefire plan, only encouraged him to believe he is capable of solving the world's most complex conflicts with the minimum of effort.
The Gaza plan is mired in deepening difficulty, and it never came near addressing the underlying causes of the war.
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Most importantly, principles the West has held inviolable for eight decades cannot be torn up for the sake of a quick and uncertain peace.
With a partner as unreliable, the challenge to Europe cannot be clearer.
In the words of one former Baltic foreign minister: "There is a glaringly obvious message for Europe in the 28-point plan: This is the end of the end.
"We have been told repeatedly and unambiguously that Ukraine's security, and therefore Europe's security, will be Europe's responsibility. And now it is. Entirely."
If Europe does not step up to the plate and guarantee Ukraine's security in the face of this American betrayal, we could all pay the consequences.
Her relationship with the president has deteriorated in recent months, and she had vocally campaigned for the justice department to release all of its files concerning the convicted paedophile Jeffrey Epstein.
Mr Trump has been fiercely critical about Ms Greene on Truth Social - describing her as a "lunatic".
In a statement posted on X, she wrote: "Standing up for American women who were raped at 14, trafficked and used by rich powerful men, should not result in me being called a traitor and threatened by the President of the United States, whom I fought for."
Ms Greene went on to confirm her last day in office will be on January 5 - with Mr Trump telling ABC that it is "great news for the country".
The hard-right Republican was one of the most aggressive spokespeople for the Make America Great Again movement - and had become infamous for her combative encounters with journalists, including Sky's Martha Kelner.
She was known for her susceptibility to conspiracy theories, and was widely denounced for comparing COVID-19 masks and vaccinations to the persecution of Jews during the Holocaust.
On social media, she had made posts advocating violence against Democrat opponents - and casting doubt on the 9/11 terror attacks and the school mass shootings at Parkland and Sandy Hook.
The bond between Ms Greene and Mr Trump started to break down after she lambasted his foreign policy - describing it as "America Last".
Mr Trump branded her a "traitor" and "wacky" and said he would endorse a challenger against her when she ran for reelection next year.
In a brief phone call on Friday night, the US president told ABC News that Ms Greene's resignation was "great news for the country." He said had no plans to speak with her but wishes her well.
Last week, Mr Trump had announced that he was withdrawing his support and endorsement for the 51-year-old, who had been expected to run for re-election in Georgia's 14th congressional district next November.
In her resignation statement, Ms Greene said: "I have too much self-respect and dignity, love my family way too much, and do not want my sweet district to have to endure a hurtful and hateful primary against me by the president we all fought for, only to fight and win my election while Republicans will likely lose the midterms."
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A few days ago, Ms Greene had warned the breakdown in relations with the White House had led to her construction company receiving a pipe bomb threat.
She had written on X: "President Trump's unwarranted and vicious attacks against me were a dog whistle to dangerous radicals that could lead to serious attacks on me and my family."
Ms Greene went on to warn his inflammatory rhetoric "puts blood in the water and creates a feeding frenzy that could ultimately lead to a harmful or even deadly outcome".
If "Make America Great Again" was in the dictionary, it would be her picture next to it - wearing a baseball cap bearing that slogan.
She had been an integral part of the MAGA movement since day one, the female version of Donald Trump.
That's why her split from the president on several issues - most recently the Epstein files - has been so stunning.
Trump was once a mentor to her, and she a devoted and formidable campaigner for him and his politics.
Greene's resignation video - in which she talks of feeling like a "battered wife" - shows that MAGA is fraying at the seams.
The Georgia representative claimed that if she had been cast aside by "MAGA Inc", it is also the case "many common Americans have been cast aside and replaced as well".
Could she be laying the groundwork for a run at higher office in 2028 by depicting herself as a champion of ordinary Americans?
Perhaps. Her path forward after prematurely ending her term in January is unclear. She could also be considering a career in the media, being so comfortable in front of the cameras.
We don't know the exact reason behind this very public political divorce, but it has been fascinating to witness.
Trump and Greene were once aligned across the board, but their relationship has ruptured in multiple ways.
She suggested the president had abandoned his "America First" platform by having a turnstile of foreign leaders through the Oval Office - but it is over the Epstein files that their schism exploded.
Greene, once reviled by Democrats for her outrage politics, joined colleagues across the aisle to support the bill to release the files.
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A woman who claimed that wildfires in California were caused by space lasers operated by Jewish people - and called Muslim-American members of Congress "the jihad squad" - was now soberly standing alongside Epstein survivors.
It prompted Trump to nickname her Marjorie "Traitor" Greene - her defiance had clearly got under his skin.
She says she is stepping down because she doesn't want her congressional district in Georgia to have to endure "a hurtful and hateful primary".
But it is also true she would have faced an uphill battle to be re-elected, especially without the president's support.
The House Committee on Oversight and Government Reform had asked the former prince to cooperate with its investigation into Jeffrey Epstein's sex trafficking operations.
Andrew was told in a letter: "Allegations against you, along with your long-standing friendship with Mr Epstein, indicate that you may possess knowledge of his activities."
He was asked to reply by 20 November - but two of the committee's members say the 65-year-old has not complied with this deadline.
Ranking member Robert Garcia and Congressman Suhas Subramanyam said Andrew's silence "speaks volumes".
In a statement, they warned: "The documents we've reviewed, along with public records and Virginia Roberts Giuffre's testimony, raise serious questions he must answer, yet he continues to hide.
"Our work will move forward with or without him, and we will hold anyone who was involved in these crimes accountable, no matter their wealth, status, or political party. We will get justice for the survivors."
As our royal correspondent Rhiannon Mills noted earlier this week, Andrew is not legally obliged to talk to Congress.
"The only time he has spoken at length about the allegations against him and his relationship with Epstein was that Newsnight interview in 2019, and we all know how much of a disaster that was," she wrote in an analysis piece on Thursday.
Virginia Giuffre died by suicide in April - and last month, her posthumous memoir detailed alleged sexual encounters with Andrew when she was a teenager.
She also spoke of her battle to escape the control of Epstein and his ex-girlfriend Ghislaine Maxwell, who is currently serving a 20-year sentence for sex trafficking.
"In my years with them, they lent me out to scores of wealthy, powerful people. I was habitually used and humiliated - and in some instances, choked, beaten, and bloodied," Ms Giuffre had written in her book Nobody's Girl.
Andrew has always vigorously denied all the accusations against him - and was formally stripped of his titles as prince and Duke of York earlier this month.
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Damaging newspaper allegations have also emerged that he tried to get the Metropolitan Police to dig up dirt for a smear campaign against Ms Giuffre.
The force previously said it was looking into the reports after The Mail on Sunday claimed he had passed her date of birth and social security number to his taxpayer-funded bodyguard in 2011 and asked him to investigate.
Earlier this week, Congress voted to force the US justice department to release all its files related to Epstein.
Donald Trump, who has changed course and now describes these files as a Democratic "hoax", has signed a bill that will pave the way for these documents to be made public within 30 days.
Emails, photos and other documents released by Congress in recent weeks have included references to Mr Trump, the UK's since sacked US ambassador Lord Mandelson, and Andrew.
Like Mr Trump, both Britons have denied any wrongdoing and expressed regret about their relationship with Epstein.