The US said it accepted Israel's solution to the dispute over Jewish settlers moving into an Arab Jerusalem area, saying it had been assured this would not change the neighbourhood's status.
"Our main concern that the nature of this neighbourhood would not change over time appears to have been met and we have received assurances that it will not be changed over time," the State Department spokesman, Mr James Rubin, said.
The Palestinian President, Mr Yasser Arafat, has rejected the deal struck on Thursday between the Israeli Prime Minister, Mr Benjamin Netanyahu, and Jewish settlers who had taken over buildings in the Ras al-Amoud district.
"This is a way for Israel to set up a base for settlers," Mr Arafat said in Cairo, where he was expected to complain about the deal to Arab League foreign ministers. In Hebron, Israeli forces fired rubber bullets at stone-throwing Arabs until Palestinian police intervened.