The Israeli air force on Tuesday bombed an Islamic State flag-raising ceremony in the holy Al-Quds mosque complex, killing at least two people and injuring dozens more, the military said.
The attack took place in a small area in the south of the Old City, located on the western edge of Jerusalem’s Old City.
The military said the military’s military radio station was broadcasting live from the scene.
The Israeli military said in a statement it was conducting “an effective military campaign” against Islamic State, also known as ISIS or ISIL, and had killed 17 Islamic State fighters.
The military said a rocket fired from Gaza into southern Israel was intercepted over the border and was aimed at the area.
No injuries or damage were reported.
Palestinian and Israeli officials have accused Israel of using a new round of airstrikes to target Islamic State positions.
The strikes have targeted a number of sites in the Old Port area of east Jerusalem, but have not targeted the mosque complex itself.
Israel says it has struck Islamic State targets around the city in recent weeks, but has not said which sites it was targeting.
The latest air raids come as Israel has begun deploying soldiers in the West Bank and Gaza Strip, where Islamic State militants have taken control of large swaths of territory.
The United Nations and the Palestinian Authority have said Israel’s recent air strikes have killed more than 1,200 Palestinians, including nearly 700 children.