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Israel sealed off the West Bank on Friday amid tension in Jerusalem over controversial plans to build new homes for Jewish settlers and fears of fresh violence at Al-Aqsa mosque compound.

The 48-hour closure to run until midnight on Saturday drew harsh criticism, with European Parliament chief Jerzy Buzek saying it was "unhelpful" and would complicate efforts to revive the Middle East peace process.

Israeli police also barred men under the age of 50 from praying at the site of the mosque compound, which is holy to both Muslims and Jews.

Isolated incidents broke out after the noon prayers and four young Palestinians were arrested after youths threw stones near Jerusalem's Old City, police said.

Security forces used stun grenades to disperse the protesters, one of whom threw a brick that smashed the windscreen of a car in which a family of settlers was travelling. Two policemen were slightly injured.

Defence Minister Ehud Barak ordered the army to seal off the Israeli-occupied West Bank, an army spokesman said, citing a heightened risk of attacks.

The closure came as US Vice President Joe Biden prepared to leave the region after visiting Israel and the West Bank to promote renewed peace talks and as Israel announced plans to build 1,600 new settler homes in predominantly Arab east Jerusalem.

The announcement infuriated Washington, ignited international condemnation and cast doubts over the outlook for the indirect talks which the Palestinians had reluctantly agreed to hold after a 14-month hiatus in negotiations.

Buzek said the closure of the West Bank would harm efforts to renew the peace talks and urged Israel to reconsider its "unhelpful" decision.

"Today we need every sign of good will for further peace negotiations to reconvene as soon as possible," he said during a visit to Jordan to attend the plenary of the Euro-Mediterranean Parliamentary Assembly.

"Now this seems even more complicated then just a few days ago."

US Middle East envoy George Mitchell on Thursday called Palestinian president Mahmud Abbas, who is visiting Tunisia, to press him to go ahead with the planned talks, a Palestinian official said.

But Abbas demanded US guarantees that Israel first freeze the project to build new homes in the east Jerusalem settlement of Ramat Shlomo.

He told US officials that "it is very difficult for us to go to any negotiations, direct or indirect, without the cancellation of the Israeli building project," Palestinian negotiator Saeb Erakat told AFP on Friday.

The US State Department insisted on Thursday it had not heard anything to indicate the Palestinians had pulled out of the planned talks and said that Mitchell was due back in the region next week.

Israeli Prime Minister Benjamin Netanyahu on Thursday apologised for the timing of the settlement announcement, made as Biden was holding a day of talks in Jerusalem on Tuesday.

Biden welcomed a clarification that construction would not start for several years, saying this would give negotiators time to tackle the issue, but he also reiterated condemnation of Israel's go-ahead for the project.

The Palestinians dismissed Biden's statement, however, saying the issue was the plan itself, not the timing of the announcement.

The international community considers all Jewish settlements in the West Bank, including east Jerusalem, to be illegal.

Under US pressure, Israel in November imposed a partial, 10-month moratorium on settlement projects in the West Bank, excluding east Jerusalem.

Israel, which seized east Jerusalem in the 1967 Six-Day War and later annexed it in a move not recognised by the international community, considers the city to be its eternal and indivisible capital.

The Palestinians see east Jerusalem as the capital of their promised state.

AFP