Amid a cloud of confusion, Israel removed controversial metal detectors installed at one of Jerusalem's most important holy sites early Tuesday, Turkey's Anadolu Agency (AA) reported.

Before midnight, heavy machinery began to enter the area of the Al-Aqsa mosque, prompting concern among local residents who have been protesting new security measures at the site for the past week.

Israel's security cabinet decided late Monday to remove the metal detectors, which Israel said were installed in response to a deadly shootout but Palestinians have rejected by refusing to pass through them, instead praying on the streets outside the mosque.

A statement released after the meeting said 100 million Israeli shekels would be allocated for a new surveillance system using "smart checks" based on advanced technology.

Sheikh Raed Dana, an imam of Al-Aqsa, told reporters near the Lions Gate entrance to the Old City, where most of the metal detectors had been placed, that the "picture until now is still unclear."

"The metal detectors have been removed. What the alternative is, we don't know," he said.

Dana said the Waqf, the Islamic foundation which manages the site according to historical agreements, would meet with political leaders in the morning to discuss their response.

Thousands of Palestinians have been taking to the street daily for a mixture of prayer and non-violent protest in the mosque's vicinity since the new security measures were introduced more than a week ago, after a two-day closure of the mosque following an attack that killed two Israeli police officers and the three suspects - who were all Palestinian citizens of Israel.

"This movement is a movement of the street. We as the Waqf listen to the street - the street says yes and we say yes, if the street says no to the measures we will say no," said Dana.

"We are weak"

As news of Israeli vehicles arriving at Lions Gate filtered through, scores of Palestinians gathered at the site, past midnight, where they faced off with border guard officers preventing anyone from approaching the construction area.

Apparently after a firework was set off, the Israeli forces forcefully dispersed the crowd by rushing at them and launching a barrage of stun grenades.

Palestinians have based their objection to any new security measures at the holy site on the insistence that a delicate balance of prayer and visiting rights, known as the "status quo" be preserved.

They have argued new security measures alter the "status quo" by strengthening Israeli control over the site.

Israel has contended that new security measures are necessary after it appeared guns were smuggled into the mosque for the attack earlier this month and compared the metal detectors to measures at other holy sites.

Baha, a resident of the nearby Ras al-Amoud neighborhood who had walked down to Lions Gate, said the dispute showed "we are weak."

"We have all types of weakness: political and military," he told Anadolu Agency. "The metal detectors are dangerous because they mean I have to go through them, to be searched by guards."

Pressure to reach a solution over the crisis mounted after a bloody weekend when four Palestinians were killed in clashes with Israeli forces and three Israelis killed in a stabbing attack inside their home in a settlement in the occupied West Bank.

Israeli Prime Minister Benjamin Netanyahu had decided to keep the metal detectors during a previous meeting on Thursday, despite concerns about the potential for violence as thousands of worshippers prayed in the streets during Friday's weekly congregational prayers.

Al-Aqsa mosque is Islam's third-holiest site but also revered by Jews, who call it the Temple Mount.

-- BERNAMA