Israel says that all of Jerusalem is its capital, while Palestinians want East Jerusalem as the capital of a future independent state. The announcement set off protests and demonstration across the West Bank, east Jerusalem and the Gaza Strip, and demonstrations around the world.
After two decades of halting peace negotiations that have failed to bring Palestinians closer to statehood, some in Abbas' inner circle have begun to speak openly about abandoning the two-state formula in favor of a single binational state. Even small crises over Jerusalem's status and that of the holy sites in its ancient Old City have sparked deadly bloodshed in the past.
Previously the USA position had been that Jerusalem's status should be resolved in peace talks between the two sides - a position shared by many world powers, who have located their Israeli embassies in Tel Aviv to avoid the appearance of taking sides in the dispute.
Last year, fans flew the Palestinian flag at a UEFA Champions League match against the Israeli team, which resulted in the club being penalized with a fine.
Most countries consider East Jerusalem , which Israel annexed after capturing it in a 1967 war, to be occupied territory and say the status of the city should be decided at future Israeli-Palestinian talks.
The Pope also called upon leaders to "commit themselves to avert a new spiral of violence" adding that they should encourage "peace, justice and security" for people in the region, which he described as a "battered land".
She told CNN that Trump was the first United States president to have the "courage" to make a move that she said many Americans and others around the world supported.
Lebanese security forces fired tear gas and water cannon at several hundred demonstrators near the United States embassy in Beirut.
Israel had deployed extra battalions to the West Bank in anticipation of violence after Palestinian leaders called for protests after Friday prayers.
Wearing all-encompassing black veils, the protesters Saturday chanted anti-Trump and anti-U.S. slogans and held banners and placards.
There was no immediate comment from security forces. In Bethlehem, Palestinians hurled stones at Israeli troops, who responded with tear gas, rubber bullets and stun grenades.
Lebanon is home to hundreds of thousands of Palestinian refugees, including those who fled Israel after it was founded, and their descendants.
The Islamist Prosperous Justice Party, or PKS - which organised the Jakarta rally and several others around the country - slammed Trump's decision as a declaration of "hostility to Muslims throughout the world".
If the US vetoes such a resolution, the Arabs would seek a similar resolution in the U.N. General Assembly, Palestinian Foreign Minister Riyad Malki told a news conference in Cairo.
"I urged the prime minister to show courage in his dealings with the Palestinians to get us out of the current dead end", Macron said after talks in Paris with the Israeli leader.
He said that many Arab nations were increasingly aligned with Israel to tackle Iran's regional threat.
And while Trump insists the move is critical to "advance the peace process and to work towards a lasting agreement", it appears to have had exactly the opposite result.