According to a statement by the Israeli police, the Palestinians opened fire at the Israeli officers injuring three policemen at the the Old City of Jerusalem's Lion's Gate (Bab Al-Asbat).
The identities of the three Palestinians remain unknown, but initial reports indicate they are Israeli citizens from Umm al-Fahm Palestinian town.
Israel lays claim to the entirety of al-Quds, while Palestinians want East Jerusalem al-Quds as the capital of their future state.
Jews know it as the Temple Mount, and for Muslims it's known as the Noble Sanctuary.
The attack occurred at around 7 a.m., police told the IBC, when the Temple Mount compound was largely empty.
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Muslims usually arrive at the Temple Mount on Friday for prayers.
Officials closed the holy site in wake of the attack..
Israeli police had a tense gun battle with the terrorists and killed all three. The Israeli ambulance service Magen David Adom said two of the Israelis wounded were receiving life-saving treatment.
Friday's shooting from inside the walled compound in Jerusalem's Old City killed two Israeli policemen.
Police are reporting that it was "apparently a shooting attack".
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The scene of Friday's terror attack near the Lions' Gate in Jerusalem's Old City.
The fighting inside the complex was one of the worst incidents of violence on the Temple Mount in years, and the footage of the gun battle and fatalities was liable to raise tensions throughout the region.
As of Friday afternoon, the Temple Mount is still closed, and Muslims held prayer sessions on the streets of Jerusalem.
Israeli Prime Minister Benjamin Netanyahu said the incident would not lead to a change in prayer rights at the site.
280 Palestinians have been killed in the same period, majority assailants, according to the Israeli police.
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It is located in east Jerusalem, occupied by Israel in the 1967 Six Day War and later annexed in a move never recognised by the global community.
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