Rock-throwing Palestinians clashed with Israeli police in East Jerusalem Tuesday, as demonstrators protested Israel's rededication of a synagogue in the area.
Israeli police fired rubber bullets and stun grenades at the demonstrators. Protests also took place in the West Bank and Gaza Strip.
Authorities say 60 Palestinians were arrested and more than a dozen people were injured, including police officers.
Palestinians were angered by Israel's decision Monday to rededicate the synagogue, which is near a site that Jews and Muslims consider sacred. They were also upset about Israel's decision last week to build 1,600 new housing units in disputed East Jerusalem.
U.N. Secretary-General Ban Ki-moon called for restraint by all parties. He also condemned Israel's announcement last week to build the new houses in East Jerusalem.
Mr. Ban said the settlements are illegal under international law.
Israel's plan to build the housing units has sparked a dispute with the United States.
U.S. State Department spokesman P.J. Crowley said Tuesday that Middle East envoy George Mitchell postponed his latest peace mission to the region due to the housing controversy. Mitchell had been due to leave Washington Monday.
Crowley also said Secretary of State Hillary Clinton expects to get a phone call Wednesday from Israeli Prime Minister Benjamin Netanyahu on Israel's formal response to the Obama administration's concerns on the housing project.
But Clinton Tuesday dismissed reports of a major crisis in U.S.-Israeli relations. She will join U.S. and European envoys in Moscow this week to discuss efforts to promote Middle East peace.