Media reports in Israel say Prime Minister Ehud Olmert has rejected an appeal from his defense minister to halt repair work near Jerusalem's al-Aqsa mosque.
The reports quote the prime minister's office as saying "nothing about the work underway will harm anyone."
They say Defense Minister Amir Peretz wrote to the prime minister Wednesday, requesting an immediate halt to the work out of fear it could escalate tensions.
Muslim leaders have called on Israel to halt its work on a ramp near what Muslims call the Noble Sanctuary, which holds the al-Aqsa mosque, Islam's third holiest site, and the Dome of the Rock shrine.
The Arab League will convene an urgent meeting on Saturday to discuss the Israeli repairs.
Muslims say the repairs endanger the holy sites.
The Palestinian representative to the League, Hussein Abdel Khaleq says the meeting will discuss what he called Israel's "aggression."
Israel has deployed about 2,000 police in the Old City as repair work continues. It is not clear whether Israel will allow West Bank Palestinians to pray at the al-Aqsa mosque on Friday.
The Israel Antiquities Authority says it is considering installing a web camera in the area that would provide 24 hour a day live pictures in order to show that Israel is not damaging the holy site.
Muslims demonstrated outside Jerusalem's Old City walls for a second straight day but there were no reports of violence.
The site also is sacred to Jews, because it was the site of the ancient Jewish temple. Disputes over the area previously have triggered Israeli-Palestinian violence.
Some information for this report was provided by AFP, AP and Reuters.