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The incident comes a day after a Palestinian killed seven people near a synagogue following Israel’s deadly raid in the Jenin refugee camp.
Two people have been injured in a shooting outside the Old City in occupied East Jerusalem, Israel’s rescue emergency response service (MDA) and Israeli Army Radio said.
An MDA spokesperson said two gunshot victims – men aged 47 and 23 – were in serious condition.
A police spokesman told Army Radio that Saturday’s incident was a “terrorist attack” adding that the assailant “was neutralised”.
The incident comes a day after a Palestinian attacker killed seven people near a synagogue on the outskirts of the city.
On Thursday, Israel carried out a deadly raid in the Jenin refugee camp in the occupied West Bank. Ten Palestinians were killed, including an elderly woman, after dozens of Israeli soldiers attacked a house the army said housed suspected fighters, leading to several hours of intense confrontations.
A 22-year-old Palestinian man was also shot by Israeli forces in the town of al-Ram, north of Jerusalem, on Thursday.
Israel also launched multiple air attacks on the blockaded Gaza Strip overnight on Thursday.
Local sources in Gaza told Al Jazeera that Israeli warplanes had hit al-Maghazi refugee camp in the centre of the territory, with at least 13 strikes by the early hours of Friday.
More to follow