Jerusalem on Edge after Police Kill Palestinian Gunman

Clashes raged in east Jerusalem Thursday after police shot dead a Palestinian accused of trying to kill a Jewish hardliner, prompting officials to close the flashpoint Al-Aqsa mosque compound.

Israel said its closure of the shrine, which is holy to Jews and Muslims, was a temporary measure aimed at calming tempers, but Palestinian President Mahmud Abbas said it was tantamount to a "declaration of war".

Wednesday night's shooting incident and the subsequent killing of the suspected gunman sent tensions soaring to a new high, following months of almost daily clashes between Palestinians and Israeli police in the occupied eastern sector of the Holy City.

"This dangerous Israeli escalation is a declaration of war on the Palestinian people and its sacred places and on the Arab and Islamic nation," Abbas said through his spokesman Nabil Abu Rudeina, warning it would only fuel "more tension and instability".

Jordan's Islamic Waqf, which has responsibility for the Muslim holy sites in Jerusalem, confirmed it was the first time such a measure had been taken since Israel seized Arab east Jerusalem during the 1967 Six Day War.

But a spokesman for Israeli Prime Minister Benjamin Netanyahu insisted that the closure of the compound was a temporary measure aimed at restoring calm.

"Closing the Temple Mount is temporary and meant to prevent riots and escalation as well as to restore calm and status quo to the Holy Places," Ofir Gendelman said in a statement.

Meanwhile, residents of the Jerusalem neighborhood of Abu Tor were left reeling after the early morning police raid which killed 32-year-old Muataz Hijazi.

Israel said he was behind the attempt to gun down hardline activist Yehuda Glick, who has lobbied for Jewish prayer rights at the Al-Aqsa compound.

Police said Hijazi began shooting at officers who returned fire, killing him. But his family had a different version.

"They burst into the house shortly before 6:00 am, ransacked Muataz's room and then shot him on the roof," said his brother Khalil, 34.

The radical Islamic Jihad movement said Hijazi was one of its militants.

Abu Tor straddles west Jerusalem and the Arab eastern sector, and borders the volatile Palestinian district of Silwan that has been the focus of months of confrontations.

Inside the house, the living room still reeked of tear gas from the raid, and on nearby side-streets riot police were firing gas canisters and rubber bullets at around 50 stone-throwing Palestinian youths in clashes that erupted after the shooting.

In a diplomatic development that the Palestinians claimed was related to the ongoing unrest in east Jerusalem, the Swedish government announced its formal recognition of a Palestinian state, becoming the first EU member in western Europe to do so.

Abbas immediately hailed Stockholm's decision as "brave and historic" and called for others to follow suit.

Israeli Foreign Minister Avigdor Lieberman lashed out at the move as "deplorable," issuing a sardonic statement noting that "relations in the Middle East are a lot more complex than the self-assembly furniture of IKEA".

In a bid to restore order in Jerusalem, Netanyahu ordered a "significant increase" in police deployments but called for calm on both sides after right-wing groups reacted furiously to the attempted hit on Glick.

In the Old City, police could be seen fanning through the streets and alleyways, imposing a near lockdown in parts, an AFP correspondent said.

"We must first of all lower the flames. No side should take the law into its own hands," Netanyahu said.

The assassination attempt followed months of tensions over the Al-Aqsa compound, which houses Islam's third holiest site but is also the most sacred spot for Jews who refer to the site as the Temple Mount.

Although non-Muslims are allowed to visit the site, Jews are not allowed to pray there for fear it could disturb the fragile status quo.

Netanyahu accused Abbas of incitement and of trying to usurp the status quo at the site over remarks several weeks ago urging Palestinians to prevent Jews from visiting the Al-Aqsa compound "by all means".

"The international community needs to stop its hypocrisy and take action against inciters, against those who try to change the status quo," he said.

Meanwhile, around 50 far-right Jewish activists held a protest near the ramp leading to the Maghreb Gate, the only entrance for non-Muslims to the Al-Aqsa plaza, an AFP correspondent said.

They waved Israeli flags and shouted: "Liberate the Temple Mount!" before dispersing without incident. Police said four of them were arrested for trying to force their way on to the plaza.

Glick, who was hit by bullets in the stomach, chest, neck and arm, was said to be in serious but stable condition.

The 48-year-old activist, who was born in New York, is a frequent visitor to the mosque compound and well-known for his lobbying efforts to secure Jewish prayer rights there.

He is the former director of the Temple Institute, a group of Jewish zealots who want to see a third Temple built on the plaza.