At least 52 Palestinians have been killed and 2,400 wounded by Israeli troops, Palestinian officials say, on the deadliest day of violence since the 2014 Gaza war.
Palestinians have been protesting for weeks but deaths soared on the day the US opened its embassy in Jerusalem.
Palestinians see this as clear US backing for Israeli rule over the whole city, whose eastern part they claim.
But US President Donald Trump hailed the move in a video message.
He told the dedication ceremony that it had been a “long time coming”, adding: “Israel is a sovereign nation with the right to determine its own capital but for many years we failed to acknowledge the obvious.”